TaxTMI 
TaxTMI 
2017 (8) TMI 491
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....ules 2016. The impugned Loan Facilities were initially provided by the Oriental Bank of Commerce, Nepeansea Road, Mumbai to the Debtor Company stated to be in the Trading Business of Medical Equipment used for diagnostic purpose. A legal notice dated 25th August, 2004 was issued under section 13(2) of the SARFAESI Act describing therein the nature of facilities reproduced below :- "Sr. No. Nature of Facilities 1. Cash Credit (Hypothecation upto to a limit of Rs. 25 lacs, Usance bills discounted up to a limit of Rs. 20 lacs and Import L/C up to a limit of Rs. 15 lacs; 2. Cash Credit (Hypothecation upto to a limit of Rs. 45 lacs, Usance bills discounted up to a limit of Rs. 40 lacs and Import L/C up to a limit of Rs. 45 lacs; 3. Cash Credit (Hypothecation upto to a limit of Rs. 95 lacs, (with sub-limit of Rs. 30 lacs for book debts), Cheque Discounting upto a limit of Rs. 10 lacs, Supply Bill up to a limit of Rs. 20 lacs, Import L/C up to a limit of Rs. 60 lacs and Term Loan up to a limit of Rs. 0.30 lacs. 4. Enhancement of CC from Rs. 95 lacs to Rs. 120 lacs; 5. Enhancement of CC from Rs. 120 lacs to Rs. 130 lacs; 6. Enhancement of CC from R....
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.... C-Ward. (a) Date of Creation : Equitable Mortgage first created on 07.03.2000. (b) Estimated Value: INR 5,00,00,000/- (Rupees Five Crore Only). 4. Flat Nos. 53 and 57, Anand Apartments, Casa Egmore, Chennai (a) Date of Creation : Equitable Mortgage first created on 24.07.1998. The same was modified & extended on 07.10.2002. (b) Estimated Value: INR 60,00,000/- (Rupees Sixty Lakhs Only.) 5. Two (2) DDA flats, being 99-B and 100-B, Group 1, Pocket 12, Jasola, New Delhi (negative lien on the flat, no mortgages created). (a) Date of Creation : Negative lien created on 01.11.1999. (b) Estimated Value: INR 50,00,000/- (Rupees Fifty Lakhs Only.) 6. Stocks of surgical equipment's, clinical, pathological, chemical reagents. (a) Date of Creation : Agreement for Hypothecation and Goods dated 12.12.1995. Extension of Mortgage to secured enhanced limits as and by way of Ninth Modification date 11.09.2002." 2.2 Thereafter, vide "Deed of Assignment" date....
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....required under the Act and, therefore, the entire action basing on such notice is bad in law. Apart from the above main contention, the Applicants are also disputing the quantum of amount demanded by the Respondent in the 13(2) notice as well as the enforceability of the mortgage said to have been created by the Applicants basing on an insufficiently stamped documents as on the date of issuing demand notice. The counsel appearing for the Applicants also relied on some case law in support of his contention so far as issuing demand notice and reply to the representation through an Advocate. Mr. Rajesh Nagori, the counsel appearing for the Respondent vehemently opposed the above pleas taken by the Applicants and also relied upon some case law in support of his contentions. Disregarding the merits of the above legal pleas raised by the Applicants, the counsel appearing for the Applicants on instruction from his client who is present in the court hall across the Bar submitted that his clients are ready and willing to deposit Rs. 50 Lacs within one week, another Rs. 50 Lacs within one week thereafter and Rs. 2 Crores within six weeks thereafter to show their bonafides. Since....
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....ements placed on record. The Petitioner is delaying the Recovery Proceeding by filing one Petition/Application after another before one Court or the other, which is nothing but a clear example of Forum Shopping. He has also placed reliance on an Order of the Hon'ble Supreme Court dated 30th September, 2010 pronounced in the case of ICICI Bank Ltd. v. Official Liquidator of APS Star Industries Ltd. [2010] 104 SCL 37/7 taxmann.com 72 wherein a view was expressed by placing reliance on a precedent that the Assignment of a Debt is not contrary to Public Policy solely on the ground that the Assignee had purchased the Debt for a discounted price. Nor will the assignment be contrary to Public Policy simply because the Assignee will make a profit on the transaction at the end of the day. It has also been expressed that the N.P.A. are created on account of breaches committed by the Borrower. It happens when a Borrower violates its obligation to repay the debt. A recent decision of NCLT Mumbai in the case of Schweitzer Systemtek India (P.) Ltd. v. Phoenix ARC (P.) Ltd. in T.C.P. NO. 316/I&BP/NCLT/MB/MAH/2017 decided on 3rd July, 2017 by N.C.LT. Mumbai Bench is also cited. 4. FINDINGS ....
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.... The Application contains the Balance Sheet along with Profit/Loss Account drawn as on 31st March, 2017. A question has been raised that under which head of the accounts the impugned debt amount is reflected in the balance sheet for the financial year 2016-17. 4.2 The contents of the unaudited provisional Balance Sheet drawn as on 5th June, 2017 has reflected the liabilities as under :- ALPHA & OMEGA DIAGNOSTICS (INDIA) LIMITED PROVISIONAL (UNAUDITED) BALANCE SHEET AS AT 05.06.2017. "Particulars Note No. 5th June-17 I. EQUITY AND LIABILITIES (1) Shareholders Funds 3,321,250 (a) Share Capital 2 (10,641,512) (b) Reserve & Surplus 3 (2) Non-Current Liabilities (a) Long Term Borrowings 4 1,30,22,911 (b) Deferred Tax Liabilities (Net) 3,97,673 (c) Other Long Term Liabilities (d) Long Term Provisionals (3) Current Liabilities (a) Short Term borrowin....
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....pect that there is a possibility of revival it is worth to examine the role of an Insolvency Resolution Professional as prescribed under section 17 of The Code (Management of affairs of corporate debtor by interim resolution professional) and under section 18 of the Code ( Duties of interim resolution professional). Side by side this Code has also casted certain responsibilities on the debtor under section 19(Personnel to extend co-operation to interim resolution professional) and Section 20 of The Code (Management of operations of corporate debtor as going concern). On account of these reasons this Bench is of the considered opinion that the Application under Section 10, now under consideration, deserves "Admission". 4.6 On examination of the Balance Sheet it has also been noticed that there are other Creditors under the Head "Short Term Borrowings", "Trade Payable" and "Current Liabilities". The Schedule as well as the details of these liabilities as on that date are not annexed hence not discussed in depth. An Insolvency Resolution Professional is a right person to examine this aspect as well and also to ascertain the fate of such Creditors. For this reason I am of the view t....
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....ts assets or any legal right or beneficial interest therein ; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002) ; (d) the recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. 2. . . . . . . . . . . 3. . . . . . . . . . . 4. . . . . . . . . . . 6. On careful reading I have noticed that the term "its" is significant. The plain language of the Section is that on the commencement of the Insolvency process the 'Moratorium' shall be declared for prohibiting any action to recover or enforce any security interest created by the Corporate Debtor in respect of "its" property. Relevant section which needs in-depth examination is section 14(1)(c) of The Code. 7. There are recognised canons of interpretation. Language of the Statute should be read as it existed. This is a trite law that no word can be added or substituted or deleted from the e....