The National Company Law Tribunal (NCLT) Amaravati has admitted a petition filed by Union Bank of India under Section 7 of the Insolvency and Bankruptcy Code, 2016 against Kallam Textiles Limited for defaulting on financial obligations worth Rs.210.49 crore. The order was delivered on April 6, 2026, initiating the Corporate Insolvency Resolution Process (CIRP) against the textile manufacturer.

Financial Default and Timeline

The petition revealed that Kallam Textiles had been availing credit facilities from the erstwhile Andhra Bank since 1999, which later merged with Union Bank of India on April 1, 2020. The company's loan accounts slipped into Non-Performing Asset (NPA) category on June 29, 2023, following its failure to repay debts on due dates.

The bank had issued a statutory demand notice dated September 11, 2024 under Section 13(2) of the SARFAESI Act, demanding Rs.185.35 crore as on June 30, 2024. When the company failed to comply, Union Bank filed the insolvency petition seeking resolution of the outstanding debt.

Public Announcement and Claims Process

Following the NCLT order, Kallam Textiles has published the mandatory Form A public announcement in leading newspapers to notify creditors about the commencement of CIRP. The announcement was published on April 7, 2026 in Financial Express (English) and Andhra Prabha (regional language) covering all relevant editions.

Creditors have been called upon to submit their claims with proof by April 20, 2026. Financial creditors must submit claims electronically, while other creditors may submit in person, by post, or electronically. The IRP's correspondence address is B-725, Western Plaza, O.U. Colony, H.S. Darga, Hyderabad 500008, with email ktl.cirp@gmail.com .

Company Profile and Operations

Kallam Textiles, incorporated on December 18, 1992, operates in textile manufacturing including spinning, dyeing and allied operations. The company argued that it provides employment to approximately 400 direct employees and over 2,000 contract and daily wage workers. In its counter-submission, the company disputed the claimed amount and highlighted several key points:

• The company had been a customer of the financial creditor for six decades
• It had paid interest of Rs.400 crore over the last 30 years
• Three different restructuring proposals and one investor proposal were submitted but rejected
• The company was exploring restructuring under the MSME scheme

Tribunal's Decision and IRP Appointment

The NCLT examined three critical issues before admitting the petition, finding the petition was filed within the prescribed period and rejecting arguments about recovery-focused proceedings. The tribunal appointed Rajesh Chillale as the Interim Resolution Professional with specific directives:

The tribunal declared moratorium under Section 14 of the IBC, prohibiting institution of suits, transfer of assets, enforcement of security interests, and recovery of property by lessors. Union Bank of India has been directed to deposit Rs.4.00 lakh with the IRP to meet operational expenses.

The admission marks the beginning of a 180-day resolution process (extendable by 90 days) during which the company's management will be suspended, and the IRP will take control of operations while seeking potential resolution plans from interested parties.

Kallam textiles Limited has announced significant changes in its board committee structure, with the reconstitution of both the Audit Committee and Nomination and Remuneration Committee. The board approved these changes during its meeting held on March 21, 2026, in compliance with regulatory requirements.

Board Meeting Details

The company has provided additional details regarding the board meeting that approved the committee changes. The meeting commenced at 02:30 PM and concluded at 03:15 PM on March 21, 2026, demonstrating efficient governance processes.

Committee Leadership Changes

The reconstitution involves strategic repositioning of key board members across both committees. The changes reflect the company's commitment to maintaining robust corporate governance standards while ensuring effective oversight of critical business functions.

Audit Committee Composition

The newly reconstituted Audit Committee features a fresh leadership structure:

Nomination and Remuneration Committee Structure

The Nomination and Remuneration Committee has been reorganized with the following composition:

Regulatory Compliance and Documentation

The committee reconstitution aligns with Regulation 30 of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015. This regulatory framework mandates timely disclosure of material events and changes in board composition to ensure transparency for stakeholders and market participants.

The company has formally communicated these changes to the Bombay Stock Exchange Limited through additional detailed documentation dated March 23, 2026. Company Secretary & Compliance Officer Golagani Ramesh Kumar signed the official intimation, confirming the implementation of these governance changes with proper digital authentication.

Corporate Governance Enhancement

The restructuring demonstrates Kallam Textiles' ongoing commitment to strengthening its corporate governance framework. Both committees play crucial roles in the company's oversight mechanisms, with the Audit Committee focusing on financial reporting and internal controls, while the Nomination and Remuneration Committee handles board appointments and compensation matters.