Corporate Insolvency proceedings initiated against Sterling Oil

18 May 2023 , 08:32 AM

Following a request by its financial creditor, State Bank of India (SBI), Sterling Oil Resources Ltd. has been accepted into the corporate insolvency resolution procedure by the bankruptcy court.

As a result of the business’s almost Rs 1,655 crore in unpaid debts, SBI filed a petition with the bankruptcy court. Purusottam Behera has been chosen to serve as the insolvency resolution specialist under the Insolvency and Bankruptcy Code, 2016, by the Mumbai bench of the National Company Law Tribunal (NCLT).

‘This bench is of the considered view that financial debt… is in existence; there is no stay on the enforcement of decree… and there is a default in payment of such debt,’ stated the division bench comprising judicial member Kishore Vemulapalli and technical member Prabhat Kumar in its ruling of May 16.

In this instance, Sterling Global Oil Resources Ltd., which is based in Mauritius, received a standby letter of credit facility from SBI in April 2014 while Sterling Oil Resources, which serves as the holding company, supplied security and an undertaking.

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