TMI Blog2020 (1) TMI 1592X X X X Extracts X X X X X X X X Extracts X X X X ..... the entire contractual dues. The contention of Corporate Debtor that the Applicant has suppressed material facts, and these orders not being placed on record by the Applicant and the date of default as per the application being 2013 the application is barred by limitation is incorrect for the reason that the Corporate Debtor cannot be allowed to take benefit of an inadvertent and bonafide mistake of the Applicant, which does not cause prejudice to the proceeding. The material facts so not placed on record by the Applicant in fact, support the case of the Applicant. The Application is well within the period of limitation as the last payment made was by virtue of order passed by the Debts Recovery Tribunal, Pune - It is seen that the Applicant has initiated proceedings before Dristrict Magistrate and The Debts Recovery Tribunal within the period of limitation and by virtue of orders passed in these proceedings, deposits have been made in the loan accounts in 2018. The Application is well within the period of limitation. It is established that the Corporate Debtor owes financial debt above a sum of ₹1,00,000/- and the default is established on perusal of the Commercial Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecuted in favour of the Applicant. 5. The Applicant submits that Corporate Debtor defaulted in repaying the loan amounts on 01.07.2013. In support of the claim of default, Statement of Accounts of the Corporate Debtor has been enclosed along with the workings for computation of Amount, which are annexed to the Application. The Corporate Debtor s account was classified as Non-Performing Asset on 22.09.2013. 6. The Applicant issued Loan Recall Notice dated 08.10.2013 under section 13(2) of SARFAESI Act, 2002 demanding payment of ₹6,11,42,097/- (Rupees Six Crore Eleven Lakh Forty Two Thousand Ninety Seven Only). 7. The Applicant has annexed Statement of Accounts of the Corporate Debtor for period 26.11.2009 to 05.07.2019, along with Certificate dated 05.07.2019 under the Bankers Book Evidence Act, 1891. On perusal of the same, the Loan disbursements are established. It is further submitted by the Counsel for the Applicant that Ld. Debt Recovery Tribunal allowed the Applicant to recover a sum of ₹50,00,000/- (Rupees Fifty Lakh Only) on 30.09.2016 and a sum of ₹20,00,000/- on 09.08.2018 which is adjusted towards recovery of unapplied interest. 8. The Applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ession. 12. It is submitted by the Counsel for the Corporate Debtor that, perusal of item 5 of form 1 filed by the Applicant shows that, no disclosure whatsoever of the OTS has been made anywhere in the Company Petition. 13. It is submitted by the Corporate Debtor that the OTS dated 27.03.2018 has changed the original bargain between the parties and has resulted into novation in terms of section 62 of the Indian Contract Act, 1872. Further, the counsel submits that the Corporate Debtor is discharged of the earlier terms and conditions. 14. The Corporate Debtor contends that whether or not the OTS was executed, whether it has been breached or whether the debt has revived are not questions raised in this proceeding as the same has been suppressed by the Applicant and there is no pleading in that regard. 15. The Corporate Debtor however has annexed copies of Recall Notice dated 08.10.2013 under section 13(2) of SARFAESI Act, 2002, copy of Order dated 15.08.2015 in Case No.40/2014, passed by District Magistrate, Raigad, Alibag allowing the Applicant to take possession of secured asset of the Corporate Debtor. The Corporate Debtor has also annexed Order dated 05.10.2016 in I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t this Application has been filed by an authorised representative of the Applicant. 23. The Applicant has annexed the Sanction Letters and loan agreements for the Term Loans along with statement of accounts of the Corporate Debtor and the Certificate under the Bankers Book Evidence Act, 1891 which establish that the Applicant has granted financial debt to the Corporate Debtor. 24. The Corporate Debtor in its Reply admits that there was delay in making payments and the account was classified NPA. on perusal of the Reply it is seen that at para 15 of the Reply, the Corporate Debtor has admitted its default by stating that there was some delay caused in monthly repayment which resulted in classification of the Account of the Corporate Debtor as NPA, para no.15 of the Reply is reproduced hereinbelow: The Corporate Debtor was regular in repayment of the loan. However, due to some unavoidable circumstances and financial crunch, there was some delay caused in monthly repayment, which resulted in classification of the Account of the Corporate Debtor as Non-Performing Assets on 13.05.2013 . 25. The Corporate Debtor does not deny that there was a financial debt and that there w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... yable under the term loan agreements shall be payable. Therefore it becomes imperative to ascertain whether the terms of the OTS have been honoured. 29. The Corporate Debtor has itself placed on record the orders passed by the Ld. District Magistrate under section 14 SARFAESI Act, and orders passed by the Debts Recovery Tribunal, Pune which allowed recovery of ₹50,00,000/- from the Corporate Debtor. The contention of Corporate Debtor that the Applicant has suppressed material facts, and these orders not being placed on record by the Applicant and the date of default as per the application being 2013 the application is barred by limitation is incorrect for the reason that the Corporate Debtor cannot be allowed to take benefit of an inadvertent and bonafide mistake of the Applicant, which does not cause prejudice to the proceeding. The material facts so not placed on record by the Applicant in fact, support the case of the Applicant. The Application is well within the period of limitation as the last payment made was by virtue of order passed by the Debts Recovery Tribunal, Pune. 30. It is seen that the Applicant has initiated proceedings before Dristrict Magistrate and T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... One Lakh against the Corporate Debtor and its default is also proved. Accordingly, the application filed under section 7 of the Insolvency and Bankruptcy Code for initiation of Corporate Insolvency Resolution Process against the Corporate Debtor deserves to be admitted. ORDER This Application filed under Section 7 of I B Code, 2016, filed by Bank of Baroda, Financial Creditor /Applicant, under section 7 of Insolvency Bankruptcy Code, 2016 (I B Code) against Renaissance Education Private Limited, Corporate Debtor for initiating corporate insolvency resolution process is admitted. We further declare moratorium u/s 14 of I B Code with consequential directions as mentioned below: I. That this Bench as a result of this prohibits: a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; b) transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; c) any action to foreclose, recover or enforce any security intere ..... X X X X Extracts X X X X X X X X Extracts X X X X
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