TMI Blog2020 (1) TMI 347X X X X Extracts X X X X X X X X Extracts X X X X ..... present petition is also filed against Corporate Debtor on 11.09.2018. The resolution plan could not be deliberated because the timeline provided in the circular came to an end. So, there is no alternative except to refer the Corporate Debtor to NCLT. So, we are totally convinced that the Petition is filed by the Financial Creditor against Corporate Debtor only because of the circular of RBI dated 12.02.2018 which was held to be ultra vires and proceedings initiated in pursuance of said circular are declared to be non-est. Petition dismissed. - CP (IB) NO. 617/7/HDB/2018 - - - Dated:- 19-11-2019 - Ratakonda Murali, Judicial Member And Narender Kumar Bhola, Technical Member Narendar Naik, Animesh Bisht and Vikram C.P., Advocates for the Petitioner. M.S. Sinivas Iyengar, Sr. Adv. and T. Sudhakar, Advocate for the Respondent. ORDER Ratakonda Murali, The Present Petition is filed by State Bank of India i.e. Financial Creditor against M/s. Simhapuri Energy Limited i.e Corporate Debtor for default of financial debt of ₹ 405,93,21,787/- (Rupees Four Hundred five crores, ninety three Lakhs, Twenty One Thousand and Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,06,58,915 (Rupees Seven Hundred and Forty Three Crores Six Lakhs Fifty Eight Thousand Nine Hundred and Fifteen Only). D. The account of the Corporate Debtor became a Non-Performing Asset ( NPA ) with the guidelines issue by the Reserve Bank of India with effect from September 28, 2016. E. As on September 8, 2018, the Corporate Debtor is in default in paying the following amounts: - Principal (in default): ₹ 204,31,34,624 (Rupees Two Hundred and Four Crores Thirty One Lakhs Thirty Four Thousand Six Hundred and Twenty Four Only); - Interest (in default): ₹ 182,39,86,683 (Rupees One Hundred and Eighty Two Crores Thirty Nine Lakhs Eighty Six Thousand Six Hundred and Eighty Three Only); - Overdue interest: ₹ 19,22,00,480.70 (Rupees Nineteen Crores Twenty Two Lakhs Four Hundred and Eighty and Paise Seventy Only). F. The Financial Creditor sent two letters dated January 3, 2018 and March 6, 2018 to the Corporate Debtor, informing the Corporate Debtor that the term loan accounts have become NPA due to non-payment and to service the irregularities. G. A Recall Notice was issued by the Financial Creditor to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dependently. 7. The reply affidavit by the Corporate Debtor against the affidavit of the Financial Creditor dated 25.04.2019 in which Corporate Debtor is contending inter alia among others the following: I. It is averred by the Corporate Debtor/Respondent that they filed Writ Petition (Civil) No.1402/2018 before the Hon'ble Supreme Court India against the Union of India and other Financial Creditors, challenging the circular dated 12.02.2018 issued by the Reserve Bank of India and also for consequential reliefs. The Hon'ble Supreme Court heard the matter along with batch of Writ Petitions where in orders were passed in favour of Petitioners on 02.04.2019, declaring the said RBI circular dated 12.02.2018 is ultra vires, apart from declaring all the actions taken under the circular, including the actions by which Insolvency Code has been triggered as non-est. Hence the present Petition is liable to be dismissed as non-est as per the judgment of Hon'ble Supreme Court. II. The Respondent further stated that the affidavit filed on behalf of Financial Creditor is not disclosing the facts in proper perspective and the same are misleading. II ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndent by way of letter dated 06.10.2018, where in it is admitted that the legal action through DRT/NCLT was being initiated as per the decision taken in the consortium meeting dated 06.09.2018 and feasibility of any resolution plan would be taken up after filing application in NCLT/DRT. VII. Thus, it is clear from above response of Financial Creditor that the present case is emanated and/or triggered in pursuance of RBI circular dated 12.02.2018, which is already declared by the Hon'ble Supreme Court as Ultra vires and non-est. VIII. It is stated all the lenders of both Phase I and Phase II entered into Master Inter Creditor Agreement dated 28.04.2013, agreeing for the modalities to take steps collectively with the approval of majority of Lenders. Article-IV of the Master Inter-Creditor Agreement dated 28.04.2013 discusses COMMON INTER-CREDITOR ACTIONS by both lenders of Phases I and II of the project as follows: 4.4 Restricted Actions Except as is specifically permitted pursuant to and following compliance with the requirements under this Article 4, no lender shall; (a) take any common Inter-creditor Action, including enforcin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the facilities as on 08.09.2018 is ₹ 405,93,21,787.70. The default schedule is at Exhibit-4. Volume-1, Page Nos. 65 66 of the Petition. 10. The Learned Counsel for Financial Creditor would contend that Financial Creditor filed necessary documents to prove default in repayment of facilities. They are shown as Exhibit-11 at Volume-6, page no. 758 onwards, Exhibit-12 at Volume-7, page no. 1079 onwards, Exhibit-18, Volume 9, page No. 1379, Exhibit-16 at volume-9. Counsel contended that Financial Creditor issued a letter shown as Exhibit-15, Volume-8 page no. 1300 onwards, informing the Corporate Debtor that the term loan accounts have become NPA due to non-payment and calling upon the Corporate Debtor to service the irregularities. 11. Learned Counsel further stated that Financial Creditor has proposed Mr. Anish Niranjan Nanavaty as Interim Resolution Professional and that Petition is in order and is liable to be admitted. 12. The Learned Counsel for Financial Creditor contended that Corporate Debtor did not raise any dispute about debt and default. However, the Corporate Debtor is contending that the present proceedings are held to be non-est in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r would not have instituted the petition against Corporate Debtor under Section 7 of IBC. The Learned Counsel contended that Tribunal to consider the petition filed under Section 7 of IBC where there exist a debt and default. In this connection the Learned Counsel has relied on the judgment of Hon'ble Apex Court in the matter of Innoventive Industries Ltd. v. ICICI Bank Ltd. [2017] 84 taxmann.com 320/143 SCL 625 and Mobilox Innovations (P.) Ltd. v. Kirusa Software (P.) Ltd. [2017] 85 taxmann.com 292/144 SCL 37 (SC). Thus, Learned Counsel contended that the Financial Creditor is able to establish debt and default which is sufficient for admission of the Petition filed under Section 7 of IBC, 2016. The Petition is therefore, liable to be admitted. 13. On the other hand, the Learned Counsel for Corporate Debtor would contend that initially Corporate Debtor filed WP (civil) No. 1402/2018 before Hon'ble Apex Court against UoI Ors. including the present Financial Creditor challenging the circular dated 12.02.2018 of RBI and for consequential reliefs to restrain Respondents from initiating any legal action or coercive steps under IBC. The Writ Petition copy as well the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 11.09.2018. Thus, it can be safely concluded that the proceedings are initiated against the Corporate Debtor in pursuance of the circular of RBI dated 12.02.2018 and there is no other ground because the JLF cannot consider the resolution plan filed by SEL/Corporate Debtor following the deadline fixed by the circular of the RBI and have postponed the deliberations on the resolution plan which is clearly mentioned in paragraph 8 as under:- The feasibility of any resolution plan would be subjected to detailed scrutiny only after obtaining legal opinion in the prevailing circumstances after filing application in NCLT . Thus, Learned Counsel contended the present petition is filed by Financial Creditor only basing on the circular of RBI. 16. It is true that there is no dispute with regard to the debt as well default. The main question involved in this case is whether proceedings are initiated against the Corporate Debtor only in pursuance of the RBI circular dated 12.2.2018 referred supra. It is the case of Financial Creditor that it has initiated proceedings against Corporate Debtor by exercising its rights available under Section 7 of IBC and not only bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meeting held on 06.09.2018. It is very clear that the Financial Creditor mainly relied on the guidelines given in the circular of RBI dated 12.02.2018 and timelines provided thereunder and as resolution plan could not be implemented, therefore, the Financial Creditor to approach NCLT as per the circular of RBI. So, there is no other reason to refer the Corporate Debtor to NCLT except solely on the basis of timeline provided in the circular. The minutes of the meeting referred to above disclosed that last date referring the Corporate Debtor to NCLT expires by 11.09.2018. The present petition is also filed against Corporate Debtor on 11.09.2018. The resolution plan could not be deliberated because the timeline provided in the circular came to an end. So, there is no alternative except to refer the Corporate Debtor to NCLT. So, we are totally convinced that the Petition is filed by the Financial Creditor against Corporate Debtor only because of the circular of RBI dated 12.02.2018 which was held to be ultra vires and proceedings initiated in pursuance of said circular are declared to be non-est. Therefore, the present petition filed against Corporate Debtor is held by virtue of the ju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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