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2021 (6) TMI 790 - Tri - Companies LawSeeking direction for redemption of the debentures issued by the Respondent - Section 71(10) of the Companies Act, 2013 - HELD THAT:- It is not in dispute that the R1 by letter dated 27.04.2019 informed the BSE & NSE that the repayment of principal to various banks have been delayed due to the ongoing securitization and monetization proposals considered by the financial institutions. It is also not in dispute that by letter dated 29.06.2019, the R1 informed the BSE & NSE that due to severe liquidity crisis in the housing sector, the maturity of certain debentures has been extended till 31.10.2019 - The R1’s inability to pay the material debts is independent of other conditions / circumstances specified in clause 7.3 (f), (h) & (l) of the DTD. Therefore, the default in servicing the other material debts and the failure of the R1 to pay the interest due on the extant secured NCDs clearly constitutes events of default as agreed to between the parties under the DTD - there are no hesitation in holding that the R1 committed default in respect of the payment of interest on the debentures in terms of Section 71(10) of the Act. Sub-rule 3 indicates that the Tribunal shall pass appropriate order within 60 days from the date of receipt of the Application under Section 71(10) of the Act. However, before making an order reasonable opportunity of being heard has to be given to the Company or any other person interested in the matter. In our considered opinion reasonable opportunity has been granted to the R1 Company and the Company has been heard at length in the matter - their prerogative in timely receipt of interest against their investment (debentures) cannot be sacrificed at the altar of public interest. The submissions regarding consideration of the Resolution bids would have no bearing in the instant Company Petition. The amount of debentures is substantial and the R1 having taken the deposit, there is no reason why any indulgence should be shown to the Respondents on the ground that any Resolution Process is underway. The Petitioner / debenture trustee represents 18,959 debenture holders who are the members of the public. Therefore, under the garb of public interest their interest cannot be foregone nor the mandate under sub-section 10 of Section 71 of the Act can be diluted - application allowed.
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