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ICICI Bank Ltd. Versus M/s. Innoventive Industries Limited

2017 (1) TMI 1218 - NATIONAL COMPANY LAW TRIBUNAL, MUMBAI

Company Petition under Insolvency and Bankruptcy Code, 2016 for realization of this money - Default by Corporate Debtor - Objective under MRU Act - Whether an order could be passed u/s.7 of the Code or not? - Held that:- This Bench, on perusal of this documents filed by the Creditor, it is evident that the Corporate Debtor defaulted in making payments as mentioned above, and he has placed the record of the default with Information Utility and he also placed the name of the Insolvency Resolution .....

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or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruct .....

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ernment in consultation with any financial sector regulator. - 4. That the order of moratorium shall have effect from 17.1.2017 till the completion of the corporate insolvency resolution process or until this Bench approves the resolution plan under sub-section (1) of section 31 or passes an order for liquidation of corporate debtor under section 33, as the case may be. - 5. That the public announcement of the corporate insolvency resolution process shall be made immediately as specified .....

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jina, Mr. L. Viswanathan, Mr. Anush Mathkar, Mr. Dhananjay, Mr. Animesh Bisht, Advocates For The Respondent : Mr. Ravi Kadam, Sr. Counsel, Mr. Chetan Kapadia, Mr. Rahul Sarda, Mr. Sanjay Asher, Ms. Manik Joshi, Ms. Aditi Shukla, Advocates ORDER The Applicant company namely ICICI Bank Ltd. mentioned this Company Petition on 22.12.2016 stating that the Corporate Debtor namely Innoventive Industries Ltd. availed ₹ 40,74,57,388 as Term Loan facility, ₹ 21,80,00,000 as Working Capital fac .....

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34 as on November 30, 2016 and the Corporate Debtor is liable to pay the outstanding amount together with interest cost, expenses and other moneys which shall accrue on the contractual rate. For the Corporate Debtor has defaulted in making repayment as mentioned above, this Applicant company initiated this Company Petition under Insolvency and Bankruptcy Code, 2016 for realization of this money by initially seeking for an order of Moratorium as mentioned in the provisions of aforesaid Code. 2. I .....

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l promotion subsidy of ₹ 115,36,40,000 provided by the Government of Maharashtra under the Package Scheme of 2007 Incentive, shall for a period one year commencing on 22.7.2016 and ending of 21.7.2017 be conducted to serve as a measure of preventing unemployment and directs that in relation to such undertaking in respect of one year period mentioned above, rights, privileges, obligations, or liability accrued or incurred before 22.7.2016 and any remedy for the enforcement thereof shall rem .....

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debt owed to the creditor ignoring the order passed by the said Department declaring all liabilities and the reliefs thereof been suspended until 21st July 2017. 4. To fortify his argument, the counsel of the Corporate Debtor submits that the Maharashtra Relief Undertaking (Special Provisions) Act is armoured with non-obstante clause in section 4 with overriding effect, which is as follows:- 4. (1) Notwithstanding any law, usage, custom, contract, instrument, decree, order, award, submission, se .....

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applied with such modifications (which do not however affect the policy of the said laws) as may be specified in the notification; (ii) all or any of the agreements, settlements, awards or standing orders made under any of the laws in the Schedule to this Act, which may be applicable to the undertaking immediately before it was acquired or taken over by the State Government 3[ or before any loan, guarantee or other financial assistance was provided to it by, or with the approval of, the State G .....

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remedy for the enforcement thereof shall be suspended and all proceedings relative thereto pending before any court, tribunal, officer or authority shall be stayed; …………… 5. The counsel of the Corporate Debtor further submits that Non-Obstante clause in Section 238 of Insolvency and Bankruptcy Code 2016 as against Non-Obstante Clause in MRU, both operate in different fields, one for realisation of the credit facility availed by the Debtor and another for preven .....

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ffect to the provisions of those Acts only if there is anything inconsistent contained in any other law. In other words, if there is no provision in other enactments which are inconsistent with the Code, the provisions contained in those Acts cannot override other legislations." 7. To which the Applicant Counsel submits that non obstante class in section 238 of IBC 2016 will have overriding effect over the operation of MRU Act 1958, because the law envisaged in MRU Act is inconsistent with .....

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re the undertaking was declared a relief undertaking, in so far as the said right relates to availing of any remedy for enforcement is suspended and not existence/continuation of debt or default itself, therefore suspension of indebtedness or default has not been contemplated or provided under the MRU Act. 9. He further submits, as per Section-7, only the fact of the event of default has to be ascertained, and no other determination has been envisaged under the Code for admission of the applicat .....

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is Bench to admit the Company Petition with the direction mentioned u/s.13,14,15 & 16 of this Code. 10. On hearing the submissions of the Applicant counsel and Corporate Debtor Counsel, it is evident that non obstante class is present in both MRU Act and IB Code, now the point to be decided is whether an order could be passed u/s.7 of the Code or not. 11. It is evident on record that IB Code has come into existence subsequent to MRU Act therefore, notwithstanding clause in section 238 of IBC .....

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the rights of the employees are protected to the extent mentioned under IBC, therefore, the Corporate Debtor Counsel cannot have an argument saying that passing an order u/s.7 of the Code will be against the interest of the employees. 13. Here the subject matter is liability over the company, the liability of the company has been dealt with by the MRU Act and also by IBC but with different objectives, in MRU Act, it is to protect the interest of employees and in IBC, it is for protecting the cre .....

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d. 14. The corporate debtor filed another application saying notice has not been served to the debtor, but this plea pales into insignificance because this Bench already heard the Corporate Debtor and his application has already been dismissed, therefore this application also does not lie, hence the same is also hereby dismissed. 15. As to the Petition filed by the Financial Creditor, this Bench, on perusal of this documents filed by the Creditor, it is evident that the Corporate Debtor defaulte .....

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cation declaring Moratorium with the directions as mentioned below: 1. That this Bench hereby prohibits the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; any action to foreclose, .....

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