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TMI Blog2021 (5) TMI 275X X X X Extracts X X X X X X X X Extracts X X X X ..... the requisite Form, under the head "Particulars of Financial Debt" the total amount of Debt granted by way of Debentures is stated to be Rs. 65,00,00,000/-, and the amount claimed to be in default is Rs. 22,35,75,376/- including interest. The date of default is stated to be 12.11.2019. Under Clause 6 of Annexure "2" of the Debenture Trust Deed, the Debentures were to be redeemed in four installments each quarter, commencing from the 5th quarter, i.e. 12.02.2020. 3. The Petitioner had filed the present Petition on 20.11.2020 for the default which occurred due to failure in repayment of 1st installment. BRIEF HISTORY OF THE CASE 4. The Corporate Debtor was in need of funds for repayment of its existing debts and for expenses related to residential project being developed under the name "Ten BKC" in Mumbai by the Corporate Debtor. For above mentioned purposes the Corporate Debtor issued 6,500 secured, unlisted, unrated redeemable, non-convertible debentures for a nominal amount of Rs. 1,00,000/- each, aggregating up to Rs. 65,00,00,000/- for a maximum period of 24 months. The said Debentures were subscribed by 167 Debenture Holders on 13.11.2018. Pursuant to which the Debenture Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 amounting to Rs. 65,00,00,000/-. 13. In light of the moratorium imposed under Section 10A, the Petitioner filed this present application in respect of defaults made on or before 23.03.2020 i.e. failure to pay the Coupon Rate for the quarters ending 12.11.2019 and 12.02.2020 and failure to pay the Redemption Amount for the quarter ending 12.02.2020 amounting to an aggregate of Rs/21,49,60,164/- together with the contractual rate of interest from the date of default till 23.03.2020. The liability of the Corporate Debtor is admitted and undisputed and the Petitioner being constrained by the nonpayment of the said sums by the Corporate Debtor, prefer the instant Application for initiation of Corporate Insolvency Resolution Process against the Corporate Debtor. 14. Following are the proofs of subscription of the Debentures: a. Private Placement offer letter dated 06.11.2018 issued by the Corporate Debtor. b. Bank statement of HDFC Bank Account No. 57500000289946 attached with the affidavit of authorised representative, Ms. Nitiksha Porwal, affirmed on 28.01.2021 and filed with the Tribunal pursuant to Order dated 17.12.2020. c. Form PAS-3 filed with Registrar of Companies, Mum ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2020 the Petitioner vide an email to Debenture holders, informed that the Corporate Debtor is seeking an extension for payment of interest due on 12.11.2019 till 28.02.2020. 24. Thereafter the Corporate Debtor vide email dated 12.02.2020 requested for setting meeting with Petitioner and sought extension for payment. On 12.02.2020 the Petitioner sent an email to the Corporate Debtor scheduling meeting on 19.02.2020 only, if the Corporate Debtor paid the interest and part principal due. 25. On 26.02.2020 the Petitioner sent an email for payment of outstanding dues on 12.11.2019 and 12.02.2020. 26. On 28.02.2020 the Corporate Debtor vide email requested more time to make payment. And also issued a letter proposing to provide additional security of Unit No. W-54 in the project. 27. On 12.03.2020 in Debenture holder's meeting, the Corporate Debtor proposed time till July 2020 for full redemption of Debentures along with coupon interest and penal interest and agreed to sign proposal by April, 2020. 28. Thereafter the Petitioner sent several emails on 08.05.2020, 11.05.2020, 09.06.2020, 13.06.2020, 19.06.2020 and 01.07.2020 as a reminder to the Corporate Debtor. 29. Thereafter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure Trustee on 09.01.2020 addressed a letter calling upon the Corporate Debtor and promoters to make payment of the coupon rate. Subsequently, the Corporate Debtor again defaulted in paying coupon as well as redemption amount on 12.02.2020. 37. The Corporate Debtor in writing has admitted the liability and the default which is evident from the letter dated 23.12.2019 from the Corporate Debtor seeking an extension till February 2020 to repay the coupon rate due on 12.11.2019. Similarly, Petitioner has placed several other letters/email dated 14.01.2020, 12.02.2020, 28.02.2020 and 07.07.2020 regarding admission of liability and failure to make payment. 38. The Petitioner mentions that when on 20.11.2020 the Petitioner had filed the present Petition, the default was for the period as on 23.03.2020. However, subsequent to that the redemption amount on 12.02.2020, 12.05.2020, 12.08.2020 and 12.11.2020 have also become due and along with the coupon rate and default interest, amounts to Rs. 91,48,46,065/-. The Bench further notes that this information of total default, is also reflected with the Information Utility as on 16.02.2021. The NeSL record in this regard is produced which confi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion has also no merit as the Debenture Trustee vide letter dated 03.08.2020 had clearly sought the consent of all Debenture-Holders to permit initiation of action against the Corporate Debtor/Promoters in terms of DTD. The Bench also notes that the Debenture Trustee had mentioned that in case of non-receipt of any response/objection from debenture-holder within 15 days from the date of email it shall be deemed that such debenture-holder has consented to the agenda item. Therefore, in view of this, the Bench is of the view that the contention of the Corporate Debtor that 51% approval of Debenture-holders should have been taken in writing is incorrect. The very fact that the Debenture Trustee has written to all debenture-holder to give their consent and that a non-receipt of any response would constitute as 'deemed approval', is totally correct. The Bench in this regard places reliance on the test laid by the Hon'ble Supreme Court as enshrined in the matter of "Innoventive Industries Vs. ICICI Bank and Ors.", the relevant portion of which is as follows:- "30. On the other hand, as we have seen, in the case of a corporate debtor who commits a default of a financial debt, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reby appointed as Interim Resolution Professional to conduct the Insolvency Resolution Process. 48. Having admitted the Petition/Application, the provisions of Moratorium as prescribed under Section 14 of the Code shall be operative henceforth with effect from the date of order, and shall be applicable by prohibiting institution of any Suit before a Court of Law, transferring/encumbering any of the assets of the Debtor etc. However, the supply of essential goods or services to the "Corporate Debtor" shall not be terminated during Moratorium period. It shall be effective till completion of the Insolvency Resolution Process or until the approval of the Resolution Plan prescribed under Section 31 of the Code. 49. That as prescribed under Section 13 of the Code on declaration of Moratorium the next step of Public Announcement of the Initiation of Corporate Insolvency Resolution Process shall be carried out by the IRP immediately on appointment, as per the provisions of the Code. 50. That the Interim Resolution Professional shall perform the duties as assigned under Section 18 and Section 15 of the Code and inform the progress of the Resolution Process and the compliance of the direc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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