TMI Blog2017 (12) TMI 1842X X X X Extracts X X X X X X X X Extracts X X X X ..... is an assignee comes under the purview of section 5(7) of I B code. Pursuant to Annexure T, the assignee herein has got right to enforce such security interest, pledges, and/or guarantees and appropriate the amount realized their form towards repayment of loan and to exercise all the rights of Assignor Bank in relation to such security interest, pledges and guarantees. The assignment of debt not at all affect the right of the debtor and therefore, respondent being evident that is a borrower does not have any right to object to the assignment of the debt by the lender. In a recent National Company Law Appellate Tribunal (NCLAT) ruling of Neelkanth Township and Construction Pvt. Ltd. v. Urban Infrastructure Trustees Ltd. [ 2017 (9) TMI 1130 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, MUMBAI ], one among the issues under consideration was the question of application of Law of Limitation about the Insolvency and Bankruptcy Code, 2016. The issues for consideration before the NCLAT was whether the application under Section 7 of the IBC is time barred, as the debt claim related to the years 2011, 2012 and 2013 and it was held that the Limitation Act, (Limitation Act) does not apply to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilities from Bank of India. Accordingly, by a sanction letter dated 15/12/2011 Bank of India agreed to sanction cash credit of Rs,5 crore and letter of credit of Rs.20 crore totaling a sum of Rs.25 crore. Copy of the sanctioned letter is annexed with the application and marked as Annexure C. 5. In terms of the sanctioned letter the corporate debtor was obliged to secure the loan by way of mortgaging immovable properties as collateral security, hypothecating the tangible movable assets, plants and machinery and by providing personal guarantee of the Directors. The corporate debtor created equitable mortgage by depositing original title deed of immovable properties. The corporate debtor had thereafter acted in default and the loan account had been classified as Non-Performing Asset by Bank of India. 6. While so, by a registered assignment agreement dated 26/3/2014, Bank of India assigned all its rights and liabilities with respect to the loan account to the corporate debtor in favour of financial creditor herein i.e. Edelweiss Asset Reconstruction Co. Ltd. 7. The corporate debtor defaulted in repaying the loan on 31/3/2013. The Financial Creditor claims a sum of Rs.37,25,85, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application. 13. Heard Ld. Counsel for the petitioner as well as the Ld. Counsel for the respondent at length and perused the records. 14. Ld. Counsel for the respondent mainly stressed his argument based on the assignment agreement Annexure-T that there is no pre-existing contract between the corporate debtor and the applicant and that Annexure T is not binding on it. According to him it is not a legally executed document and, therefore, the petitioner herein is not a financial creditor. He also highlighted an interim application at his hand and prays for leave to challenge the status of applicant in proper forum in accordance with law and prays for an adjournment of the hearing of this application. He contends that he can establish that the assignment agreement executed by the Bank of India in favour of the petitioner is not a legally executed document and, therefore, no application can be filed by the petitioner as an assignee. 15. This is an application filed under section 7 of I B Code. The question for determination in a case of this nature is entirely different than that of consideration of a petition filed under section 8 9 of I B Code. The petitioner A disputes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase we are not inclined to grant leave to file interim application to challenge the status of the applicant company and declined to grant further time to file additional objections. 17. The Ld. Counsel for the corporate debtor/respondent main challenge is that respondent did not recognize the petitioner and therefore there is no privity of contract by and between petitioner and the respondent. According to him the Annexure T is not a legally executed assignment deed and hence petitioner cannot file an application of this nature. Annexure T at page 109 is the disputed assignment deed. Ld Counsel for the respondent further submits that petitioner is not financial creditor as alleged. 18. Annexure T is the copy of the assignment agreement executed by Bank of India in favour of the petitioner. Admittedly, the respondent availed the loan from the Bank of India. Bank of India had granted credit facility amounting to Rs.25 crore in favour of the corporate debtor and in pursuance of the sanction letter issued by the bank, the corporate debtor, the respondent herein, had executed various documents and demand promissory note and hypothecation agreement and thereafter defaulted the loan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plication for initiating corporate insolvency resolution process against a corporate debtor before this Adjudicating Authority when the default has occurred. No doubt the debt claimed is a financial debt as defined under section 5(8) of I B Code. Herein this case Annexure T is found a legally executed assignment agreement. It is a registered document, stipulating all the terms and conditions. Being found Annexure T, a document admissible in evidence, this Adjudicating Authority cannot go behind the purpose of execution of the deed. Ld. Counsel for the respondent submits that it is a fraudulent document and that respondent has no knowledge about the execution of the deed. The said contentions are unsustainable in the peculiar circumstances of the case in hand. Annexure T proves that petitioner is an assignee comes under the purview of section 5(7) of I B code. Pursuant to Annexure T, the assignee herein has got right to enforce such security interest, pledges, and/or guarantees and appropriate the amount realized their form towards repayment of loan and to exercise all the rights of Assignor Bank in relation to such security interest, pledges and guarantees. The assignment of debt n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I B Code. 22. One another contention stressed by the Ld. Counsel for the respondent is that Ms. Sukanya Sahani is not authorised to sign and affirm the application filed in this case and hence this petition is not maintainable for want of valid authority. According to him the resolution relied upon by the petitioner cannot be termed as a board resolution as it was signed by the company secretary of the company. Petitioner has filed this application based on resolution dated 17/8/2017. The resolution is shown as Annexure A. A perusal of Annexure A shows that it is certified copy of the resolution passed by circulation by the Board of Directors. Annexure A, shows that Ms. Sukanya Sahani is the authorised signatory authorised by the board resolution. The Company Secretary of the company signed it as a true copy. The resolution produced is a copy of the board resolution authorising Ms. Sukanya Sahani. Therefore, we find no defect in the resolution Annexure A submitted along with this petition. The resolution can be acted upon in a case of this nature. 23. The next contention of the Ld. Respondent is that this application is factually barred by laws of limitation and hence financ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner suppressed material facts are all found not worthy for consideration. In an application of this nature, this Adjudicating Authority is bound firstly to consider as to whether there is existence of default from the records and information utility or based on other evidence furnished by the financial creditor. If the petitioner succeeds in proving default of which the claim put forward by the petitioner and satisfy Sec.7 (5)(a) of the I B Code, this Adjudicating Authority is bound to admit the application. The procedure adopted for the disposal of this application is summery in nature. This petition has been filed by the petitioner on 25/10/2017. Petitioner has succeeded in proving existence of default. Annexure U dated 15% March 2013 and Annexure V dated 22m May 2013 strengthen the petitioner's contention that respondent admitted its default. The respondent in the said letter requested the Bank for reconstruction of their account. The petitioner also produced statement of accounts and computation statement to show that amount claimed in the application is due from the respondent. Computation statements are Annexures W1, W2 and W3. Annexure W3 is the certificate showing tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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