TMI Blog2018 (7) TMI 1740X X X X Extracts X X X X X X X X Extracts X X X X ..... limsy ground. Thus, we have no hesitation to reject the argument raised on behalf of the Corporate Debtor. Another argument that the petitioner has failed to adhere to the provisions of the Bankers Book Evidence Act, 1891 while submitting the Statement of Accounts, which is a mandatory provision as per the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 has also lost its sheen because vide Diary No. 669, dated 07.02.2018 an additional affidavit has been filed by Mr. Puneet Gogia along with a certificate in accordance with the Banker’s Books Evidence Act, 1891 [Annexure-B (Colly)]. The filing of the aforesaid certificate completely answers the said objection The office is directed to communicate a copy of the order to the Financial Creditor, the Corporate Debtor and the Interim Resolution Professional at the earliest but not later than three days from today - (IB)-477(PB)/2017 - - - Dated:- 13-6-2018 - MR M. M. KUMAR, PRESIDENT AND MR S. K. Mohapatra, MEMBER (T) For The Financial Creditor : Mr. H. L. Tiku, Senior Advocate with Mr. Mrityunjay Kumar, Advocate For The Respondent : Mr. Anand A. Pavgi And Mr. Anurag Bhatt, Advocates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e averments of the Financial Creditor are that the PD Memorial Religious and Educational Association (for brevity the Association ) and the Corporate Debtor are part of the same group entities and they intended to set up an educational institute in Chandigarh, Haryana and accordingly, they approached the Financial Creditor in the year 2014 for financial assistance in form of loan amount of ₹ 5,00,00,000 (five crores only). On the request of Association and the Corporate Debtor, the term loan of ₹ 5,00,00,000 (five crores only) was sanctioned and disbursed on 08.09.2014 for the total term of 84 months. In this regard an agreement was executed between the Financial Creditor, the Association, the Corporate Debtor and certain individual co-borrowers. A copy of the agreement has been placed on record [(Annexure-I(l) (Colly)]. 6. In column 2 of part IV the amount claimed to be in default and the date on which the default occurred is stated to be 02.06.2016 as per the repayment schedule of the revised sanction letter. According to the averments made by the Financial Creditor the loan facility which is availed by the Corporate Debtor is overdue and total amount in default ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... September, 2014, namely, AU Financiers (India) Limited which, subsequently, in April, 2017 was granted license to operate as a Bank and its name was consequently changed to AU Small Finance Bank Limited. A copy of statements of accounts by AU Financiers (India) Limited for the duration of January 1, 2013 to January 4, 2016 and from January 1, 2016 to March 31, 2017 as well as a copy of statement of account by AU Small Finance Bank Limited for the duration of April 1, 2017 to February 1, 2018 with a certificate in accordance with the Banker s Books Evidence Act, 1891 have been placed on record [Annexure-B (Colly)]. In the said affidavit it has also been highlighted that the original loan agreement was executed by one Mr. Rajeev Kumar on behalf of the Financial Creditor, who at that relevant time held the post of Manager with the Financial Creditor. Affidavit of Mr. Rajeev Kumar verifying the contents has also been placed on record (pgs. 5-6). 12. Subsequently another additional affidavit vide Diary No. 1272, dated 08.03.2018 was filed by Mr. Puneet Gogia on behalf of the Financial Creditor whereby a consent letter (Annexure-A) executed by the borrowers including the Corporate De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the seal of the Petitioner. 14. The applicant has filed rejoinder reiterating the averments made in the application and denying the objection raised by the Corporate Debtor. 15. Mr. H.L. Tiku, learned Senior Counsel for the petitioner has argued that all requirements of Section 7 for the initiation of Corporate Insolvency Resolution Process by a Financial Creditor stand fulfilled. In that regard, he has submitted that the application is complete as per the requirements prescribed by Rule 4(1) of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 read with Section 7(2) of IBC. He has further submitted that the details of the default along with its dates have been clearly stated in part IV along with all the minute details. There is overwhelming evidence to prove default and name of the resolution professional has also been clearly specified. 16. Having heard learned counsels for the parties and having perused the paper book with their able assistance we may first examine the provisions of Section 7(2) and Section 7(5) of IBC which read as under:- Initiation of corporate insolvency resolution process by financial creditor. 7(1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s or any legal right or beneficial interest therein; (c) 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 Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. 21. It is made clear that the provisions of moratorium shall not apply to transactions which might be notified by the Central Government. Additionally, the supply of essential goods or services to the Corporate Debtor as may be specified is not to be terminated or suspended or interrupted during the moratorium period. These would include supply of water, electricity and similar other supplies of goods or services as provided by Regulation 32 of IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 22. The Interim Resolution Professional shall perform all his functions religiously and strictly which are contemplated, inter alia, by Sections 15, 17, 18, 19, 20 21 of the Code. He must follow best pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been signed by the aforesaid officer. In view thereof, we do not find any substance in such kind of objection raised on behalf of respondent. 24. The argument of the Corporate Debtor that the agreement has not been signed by the Financial Creditor would not cut any ice because one copy is signed by one party and deposited with the other and vice versa. Moreover, the agreement is supported by CIBIL account and the statement of account is duly supported by a certificate issued under the Banker s Book Evidence Act. There is no denial concerning disbursement of the loan or default in its repayment. Thus, on merit occurrence of default has not been disputed. Accordingly, we reject the objections raised by the Corporate Debtor. 25. One of the principal objection raised by the Corporate Debtor is that the amount has been disbursed by the petitioner to an Education society namely P.D. Memorial Religious and Educational Association and not to the respondent-Corporate Debtor, a rejoinder to the aforesaid objection has been filed and various documents have been placed on record. An application for loan was sent on the letter pad of the Prabhu Shanti Real Estate Pvt. Ltd. which is duly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pe that the Corporate Debtor is a co-borrower and has also created charge on the property as per the Form No. CHG-1. Therefore, Mr. Tiku, learned Senior Counsel has argued that the Corporate Debtor is part and parcel of the loan agreement as very much party to the same. In view of the aforesaid detail rejoinder filed by the petitioner we have no option but to accept the submission that the loan has been taken by the Corporate Debtor along with others. 27. It is also evident from the perusal of documents [Annexure R(l)(Colly)] Annexure R(2) filed by the Financial Creditor along with the rejoinder that the shareholders of the Respondent Company are also the members of the Association, and thus fall under the same management. It is further obvious that the affairs of the Association being managed by the persons who are holding key managerial position and 99.83% of the shareholding in the Respondent Company. It can be further seen that Mr. Joginder Singh is the Director and Joint Secretary in the Respondent Company and Association respectively, who has executed and signed each of the documents including loan agreement as well which were required for the purpose of granting loan. M ..... X X X X Extracts X X X X X X X X Extracts X X X X
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