TaxTMI 
TaxTMI 
2020 (1) TMI 1240
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....ovisions of the Companies Act, 1956 and is, inter alia, engaged in the business of manufacture of vessels and repairing of rigs. The Corporate Debtor, Reliance Naval and Engineering Limited was earlier known as Reliance Defence and Engineering Limited, which name was subsequently changed to Reliance Naval and Engineering Limited having its Registered Office at Port of Pipavav, Post Ucchaya, Via Rajula, Dist. Amreli, Gujarat - 365 560. The Respondent company, the Corporate Debtor was originally promoted by SKIL Infrastructure Ltd. (SKIL) as Pipavav Defence and Offshore Engineering Ltd. 3. The Authorised Share Capital of the Respondent company, the Corporate Debtor is Rs. 15000,00,00,000/-. (Rupees Fifteen Thousand Crores only). The Paid-Up Share Capital of the Respondent company, the Corporate Debtor is Rs. 779,83,70,270/- (Rupees Seven Hundred and Seventy-Nine Crores Eighty-Three Lakhs Seventy Thousand Two Hundred and Seventy only). The Main Object of the Respondent company, the Corporate Debtor as mentioned in the preceding para is manufacturing of vessels and repairing of rigs. 4. As per Part IV of the application, the total amount of debt granted by the IDBI, the Financial Cre....
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....ck 2w as being constructed adjacent to the existing Dry Dock 1 facility admeasuring 750 m x 60 m x 19 m for maintenance & repair of ships, boats, and other water craft. Consequent to financial stress, the Respondent company, the Corporate Debtor underwent restructuring of its debt under CDR Scheme. The Restructuring Scheme was approved by CDR EG on march 18, 2015. 5.2 In March 2015, Reliance Defence Systems Pvt. Ltd., part of R-ADA Group and step-down subsidiary of Reliance Infrastructure Ltd., entered into an agreement to take over the management of the Respondent company, the Corporate Debtor from the former promoters. Purchase Agreement to acquire former's promoter stake of about 17.66% in the Respondent company, the Corporate Debtor was also executed. Mandatory Open Offer to acquire 26% shares from public shareholders of the Respondent company, the Corporate Debtor was announced on March 04, 2015. 5.3 R-ADA Group acquired management control of the Respondent company, the Corporate Debtor on January 18, 2016 with reconstitution of the Board Defence and Engineering Ltd. (RDEL) on March 03, 2016 and later on renamed as Reliance Naval and Engineering Ltd. with effect from Sep....
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....submitted an OTS proposal in end of March 2018, the contours of which witnessed frequent and significant changes based on discussions with lenders. The Respondent company, the Corporate Debtor submitted an OTS proposal on May 7, 2018, which had certain issues with lenders. 5.11 The issues raised by lenders on the OTS proposal were communicated to the Respondent company, the Corporate Debtor on May 18, 2018. As the Respondent company, the Corporate Debtor could not resolve the issues raised by lenders to their satisfaction, lenders were not able to proceed with the OTS proposal. The Respondent company, the Corporate Debtor was informed of the same by Applicant Bank, the Financial Creditor vide their letters dated June 7, 2018 and June 25, 2018. 5.12 Since, the OTS proposal of the Respondent company, the Corporate Debtor was not acceptable to the lenders, it was decided to initiate Corporate Insolvency Resolution Process against the Respondent company, the Corporate Debtor, as provided under IBC. 6. Petitioner Bank has filed innumerable number of documents including Certificate under Bankers Books Evidence Act, Annexure "H". The above documents clearly establish existence of defau....
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....in favour of Security Trustee by SKIL Infrastructure Limited, Grevek Investment and Finance Private Limited and SKIL Holdings Private Limited. Exhibit "F-10". k. Share Pledge Agreement dated 20th April, 2015. Exhibit "F-11". l. Power of Attorney dated 20th April, 2015 in favour of Security Trustee. Exhibit "F-12". m. Promoters Undertaking dated 30th April, 2015. Exhibit "F-13". n. Deed of Hypothecation dated 23rd May, 2015. Exhibit "F-14". o. Indenture of Mortgage dated 14th July, 2015 relating to land located within sub-district of Rajula. Exhibit "F-15". p. Indenture of Mortgage dated 14th July, 2015 relating to land located with sub-district of Jafrabad. Exhibit "F-16". q. Debenture Trust Deed dated 16th June, 2017. Exhibit "F-17". r. Share Pledge Agreement dated 16th June, 2017. Exhibit "F-18". s. Confirmation Agreement dated 16th June, 2017 (Exhibit "F-19". 3. A copy of the CIBIL report dated 31st August, 2018. Exhibit "G". 4. Copies of entries in the Bankers book in accordance with the Bankers Books Evidence Act, 1891. Exhibit "H". 5. Other documents to prove the existence of financial debt: a. Acknowledgement of Debt & Confirmation of Security from ....
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....lt. 8.2 It is stated that Shipyards Association of India, wherein the Applicant of the IA, is a Member had challenged the vires of the certain provisions of the Banking Regulation Act, 1949 and the legality and validity of the circular dated 12.02.2018, before the Hon'ble High Court of Gujarat, which was numbered as Special Civil Application No. 12492 of 2018. 8.3 It if further stated that pursuant to Transfer Petitions by the RBI before the Hon'ble Supreme Court, the Petition filed by the Association was transferred for adjudication before the Hon'ble Supreme Court. 8.4 It is submitted that the Hon'ble Supreme Court after hearing all the stakeholders passed a Judgment dated 02.04.2019, as reported in (2019) 5 SCC 480 [Dharani Sugars and Chemicals Limited versus Union of India and Others], whereby it quashed and set aside the circular dated 12.02.2018. The Hon'ble Supreme Court has further held and declared that all cases to be non-est which were initiated by Financial Creditors on the basis of impugned circular dated 12.02.2018. 8.5. Hence the present IA by the Applicant that present proceedings against the applicant which are initiated by the Financial Cre....
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....The subsequent settlement proposal was rejected by the lenders and the Corporate Debtor/Applicant was intimated to improve the offer. The revised restructuring proposal was under consideration when RBI circular came to be in operation. In terms of the circular, "if any restructuring proposal was not formulated within 180 days of the circular being notified, the Financial Creditor needs to file any application under Section 7 of the IB Code". Even otherwise, in the present facts and circumstances, the lenders would have to take the same course of action viz. Initiate CIRP against the Corporate Debtor irrespective of whether the RBI circular was in force or not at that point in time. It is an admitted fact there is debt, debt is due and the Corporate Debtor is in default. E. It is submitted by the Respondent/the Original Applicant/the Financial Creditor that Corporate Debtor/Applicant has misinterpreted the order passed by the Hon'ble Supreme Court in Dharani Sugars and Chemicals Ltd. v/s. Union of India and Ors. which is reproduced hereunder: Supreme Court Order dated 2nd April, 2019 in the matter of Dharani Sugars (supra) The Supreme Court Order, inter alia, directs as un....