TMI Blog2017 (11) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Respondent in repayment of the financial debt. Therefore, Applicant is a ‘Financial Creditor’ and Respondent is a ‘Corporate Debtor’. A default has been committed by the Corporate Debtor in repayment of the financial debt. The Applicant proposed the name of Mr. Devendra Padamchand Jain as ‘Interim Insolvency Resolution Professional’ and also filed his Written Communication. In view of the above discussion, this Application deserves to be admitted and it is accordingly admitted under Section 7(5) of the Code. The Interim Insolvency Resolution Professional is hereby directed to cause public announcement of the initiation of ‘Corporate Insolvency Resolution Process’ and call for submission of claims under Section 13(l)(b) read with Section 15 of the Code and Regulation 6 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The other Secured and Unsecured Creditors and Operational Creditors are also entitled to file their claims before the Interim Insolvency Resolution Professional. Also order moratorium under Section 13(1)(a) of the IB Code accordingly. - C.P. NO. (I.B.) 113/7/NCLT/AHM/2017 - - - Dated:- 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed their shares of the Respondent Company and executed Agreement for Pledge of Shares on 29th April, 2008 in favour of Financial Creditor. Guarantors, Shri Bharat Patel, Smt. Bharati Patel and Smt. Smita B. Patel executed Personal Guarantee Deed dated 28th April, 2008 in favour of Financial Creditor. M/s. Surya Offset Printers (India) Private Limited executed a Deed of Corporate Guarantee dated 28th April, 2008. As per the Loan Agreement dated 4th April, 2008, Respondent shall open an Escrow Account into which the Respondent shall deposit or cause to be deposited all amounts accruing under the Scheme in the said account and the account shall be operated by the Respondent on the terms and conditions contained in the Escrow Agreement dated 28th April, 2008. Applicant filed all the relevant documents relating to the said loan transactions. 6. Dena Bank sanctioned Term Loan of ₹ 8.50 Crores to the Respondent vide Sanction Letter dated 16th September, 2010 read with Letters dated 20th September, 2010, 24th September, 2010, 18th October, 2010 and 4th November, 2010 for construction of AURA Mall under the multiple banking arrangements with HUDCO. The Loan Agreement dated 24th Sep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - and ₹ 7,59,16,048/- as acquired from Dena Bank and it is treated as outstanding debt. As per the Restructuring Agreement, the existing security interest already created in favour of HUDCO and Dena Bank would continue and ensue for the benefit of Financial Creditor. The Restructuring Agreement also provides for creation of Additional Security Interest. Financial Creditor sanctioned Additional Loan of ₹ 12 Crores to the Corporate Debtor. Corporate Debtor executed Loan Agreement dated 18th April, 2013. An Addendum to the Loan Agreement was executed on 23rd April, 2013. The Additional Loan is also secured by Deed of Hypothecation, by Mortgage and by Personal Guarantors, Corporate Guarantee etc. Financial Creditor vide letter dated 28th February, 2014 restructured the loans and additional loan was rescheduled. Further, on the request of the Corporate Debtor, another sum of ₹ 5 Crores was given as loan by a letter dated 26th February, 2014. In that connection, Loan Agreement dated 28th February, 2014 was executed. The said loan was secured by Deed of Hypothecation by creating charge on the immovable properties by deposit of title deeds, by giving Personal Guarantees a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operty situated in Arera Colony, Bhopal for sale. The said property is part of the property mortgaged by the Corporate Debtor, Shri Bharat Patel and Smt. Bharati Patel to the Financial Creditor. Financial Creditor addressed a letter dated 7th October, 2016 to the Syndicate Bank objecting to the auction of the aforesaid property by Syndicate Bank. Thereupon, Financial Creditor filed Securitisation Application No. 31/2017 before Debt Recovery Tribunal at Jabalpur against Syndicate Bank, Corporate Debtor and others which is pending adjudication. The following are the outstanding amounts as on 4th August, 2017:- A. Loans acquired from Dena Bank and HUDCO . Particulars Amount (in Rs.) Principal Oustanding 28,93,60,709 Interest 54,87,52,740 Penal Interest 5,91,39,613 Total 89,72,53,062 B. Additional Loan of ₹ 12 Crores . Particulars Amount (in Rs.) Principal Oustanding 12,00,00,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India. In fact applicant gave advertisements in Economic Times and Times of India for sale of AURA Mall for which bills worth ₹ 13.80 lakhs were raised against the Company. The Applicant did not communicate the result of advertisements for 7 months. Thereafter, Applicant issued notice under Section 13(2) of the SARFAESI Act on 10th April, 2017. The assets of the Company worth more than ₹ 300 Crores were illegally mortgaged with the Financial Creditor for the initial loan of ₹ 45.94 Crores and now the Applicant established liability of ₹ 132 Crores which is 3 times over and above the initial amount in a span of 4 years and 3 months which is highly improbable and grossly illegal. Respondent also pleaded that in complete deviation to the terms and conditions agreed between JM Financial Asset Reconstruction Company Ltd, a letter of termination of service was served upon the Company without any prior intimation or communication. 13. Respondent also stated that it has also published the sale of Aura Mall in the Economic Times for which 27 prospective responses have come but the Company could not capitalise the responses as the Applicant already terminated thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lvency Resolution Process in respect of the Corporate Debtor. 15. The Hon ble National Company Law Appellate Tribunal, in the matter of Innoventive Industries Ltd. v. ICICI Bank [2017] Anr, decided on 17th January, 2017, held as follows in the following paragraphs; 82. As discussed in the previous paragraphs, for initiation of corporate resolution process by financial creditor under sub- section (4) of Section 7 of the Code, 2016, the adjudicating authority on receipt of application under sub-section (2) is required to ascertain existence of default from the records of Information Utility or on the basis of other evidence furnished by the financial creditor under sub-section (3). Under Section 5 of Section 7, the adjudicating authority is required to satisfy - (a) Whether a default has occurred; (b) Whether an application is complete; and (c) Whether any disciplinary proceeding is against the proposed Insolvency Resolution Professional. 83. Once it is satisfied it is required to admit the case but in case the, application is incomplete application, the financial creditor is to be granted seven days time to complete the application. However, in a ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Applicant proposed the name of Mr. Devendra Padamchand Jain as Interim Insolvency Resolution Professional and also filed his Written Communication. 18. In view of the above discussion, this Application deserves to be admitted and it is accordingly admitted under Section 7(5) of the Code. 19. This Adjudicating Authority hereby appoint Shri Devendra Padamchand Jain, having his address at A-43, Prima Plaza, Opposite DLA School, Bodakdev, Ahmedabad-380054, and having Registration No. IBBI/IPA-001/IP-P00255/2017-18/10484 under Section 13(1)(c) of the Code. 20. The Interim Insolvency Resolution Professional is hereby directed to cause public announcement of the initiation of Corporate Insolvency Resolution Process and call for submission of claims under Section 13(l)(b) read with Section 15 of the Code and Regulation 6 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. The other Secured and Unsecured Creditors and Operational Creditors are also entitled to file their claims before the Interim Insolvency Resolution Professional. 21. This Adjudicating Authority hereby order moratorium under Section 13(1) (a) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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