TaxTMI 
TaxTMI 
TaxTMI 
2018 (3) TMI 1778
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....tion Process has been prayed for, was incorporated on 15.01.1996 having its registered office at 3721, Gali Barna, Sadar Bazar, New Delhi - 110006. Since the registered office of the respondent corporate debtor is in New Delhi, this Tribunal having territorial jurisdiction over the NCT of Delhi is the Adjudicating Authority in relation to the prayer for initiation of Corporate Insolvency Resolution Process in respect of respondent corporate debtor under sub-section (1) of Section 60 of the Code. 3. It is appropriate to mention that the applicant Yes Bank Ltd. is a company incorporated and registered under the Companies Act, 1956 and a banking company within the meaning of Section 5(c) of the Banking Regulation Act, 1949 having its Registered Office at Nehru Centre, 9th Floor, Discovery of India, Dr. A. B. Road, Worli, Mumbai - 400018. 4. Mr. Gaurav Sarkar authorized representative and working as Vice President of the applicant bank, has preferred the present application on behalf of the applicant for initiation of corporate insolvency resolution process against the respondent corporate debtor in terms of the provisions of the Code. 5. The applicant has proposed the name of Mr. A....
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....t. 10. It is stated in the application that as on 02.07.2018 the total outstanding amount including interest due to the respondent corporate debtor comes to Rs. 16,56,57,800.89/-. 11. The applicant has relied upon the following securities and other loan related documents executed between the parties in respect of the financial facilities sanctioned to the respondent corporate debtor: * Facility Letter Ref #YBL/DEL/FL/0138/2016-17 for sanction of Working Capital Facility. * Facility Letter Ref #YBL/DEL/FL/0782/2016-17 for modification of sanctioned of Working Capital Facility. * Facility Letter Ref #YBL/DEL/FL/1142/2017-18 for enhancement of Working Capital Facility. * Working Capital Master Facility Agreement dated 23.05.2016. * Supplemental Master Facility Agreement dated 28.09.2017. * Deed of Hypothecation dated 23.05.2016. * Supplemental Deed Hypothecation dated 28.09.2017 along with Power of Attorney dated 28.09.2017. * Demand Promissory Note dated 28.09.2017. * Letter of Continuity for demand promissory note dated 28.09.2017. * Letter of Continuing Guarantee Executed by Mr. Neeraj Kumar Jain and Mr. Naresh Kumar Jain dated 28.09.2017. * Reported on CRIL....
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....0 Crores and also the certificate of Registration for Modification of Charge issued by Registrar of Companies on 16.01.2018 in order to secure the enhanced limit of Rs. 25 Crores. 13. In addition, Certificate under Section 2A of Bankers' Books Evidence Act, 1891 has been filed along with copy of relevant statement of accounts of the corporate debtor. Applicant has also annexed the detail working for computation of the amount and days of default in support of its claim. 14. It is thus seen that the applicant 'financial creditor' has placed on record voluminous and overwhelming evidence in support of the claim as well as to prove the default. 15. On the ground of default in repayment of huge outstanding amount, it is prayed for initiation of corporate insolvency resolution process against the respondent company by admitting the present application. 16. The respondent corporate debtor has filed its reply on 31.08.2018. Rejoinder to the reply was filed by applicant on 05.09.2018. 17. We have heard the learned counsels for the parties and have perused the case records. 18. The various objections raised by the respondent corporate debtor are discussed below. 19. The re....
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....due and payable by responded company to applicant bank because a serious fraud has been committed by the applicant bank. The respondent has filed CA on 31.08.18 and additional documents on 13.11.2018 and relied upon emails dated 21.04.2018, 16.04.2018, 07.04.2018 and 03.04.2018 to show that the applicant is already aware about the fact of the fraud. Respondent company also requests for information, freezing of beneficiary bank accounts, and reversal of the alleged fraudulent transactions. 24. It is also contended that respondent has filed FIR No. 222/2018 lodged in Palwal Police Station alleging Applicant Bank's involvement in defrauding the Respondent and the same is still pending investigation. 25. The respondent has further submitted that a Civil Suit is pending before District Court of Palwal/Faridabad in this regard. It is claimed that since no determination of the Respondent dues has been made, the Respondent cannot be in default of any financial debt payable to the Applicant Bank. 26. In this regard applicant in its rejoinder has submitted that the FIR is irrelevant to the present proceedings as the same relates to the outflow of the funds from the account of responde....
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....1. It is also pertinent to note that the Adjudicating Authority cannot decide 'issue of collusion', which can be decided by the Court of competent jurisdiction. Similarly Adjudicating Authority is not supposed to ascertain the quantum of amount of default actually due to the financial creditor. Adjudicating Authority is only to ascertain the existence of a default and not the exact amount due. What is material is that the default is at least for Rs. 1 Lakh. 32. Once there is a debt and default, the Adjudicating Authority has no option but to admit the application filed under Section 7 of the Code, when it is complete. It is also settled law that facts which are not required to be disclosed as per the prescribed format, cannot be treated as suppression of facts. 33. Respondent company has admitted that it availed loan from the applicant by executing the Master Facility Agreement dated 12.05.2016 and subsequently executed supplementary agreement dated 28.09.2017 in order to avail a higher credit limit from the applicant bank. Respondent further has admitted in its reply that it had opened bank account with the applicant bank. 34. Applicant has relied upon CRILIC report dat....
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....owed the credit facility against payment of interest as agreed between the parties. The loan was disbursed against the consideration for time value of money with a clear commercial effect of borrowing. Moreover the debt claimed in the present application includes both the component of outstanding principal and interest. In that view of the matter not only the present claim comes within the purview of 'Financial Debt' but also the applicant can clearly be termed as 'Financial Creditor' so as to prefer the present application under Section 7 of the Code. 41. The application filed by the applicant financial creditor under sub-section 5(a) of Section 7 of the code, has to be admitted on satisfaction that: i. Default has occurred. ii. Application is complete, and iii. No disciplinary proceeding against the proposed IRP is pending. 42. Hon'ble Supreme Court in the case of Mobilox Innovations (P.) Ltd. v. Kirusa Software (P.) Ltd. [2017] 85 taxmann.com 292/144 SCL 37 at Para 19 has observed that: "Once the adjudicating authority/Tribunal is satisfied as to the existence of the default and has ensured that the application is complete and no disciplinary procee....
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....ny security interest created by the corporate debtor in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 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." 48. It is made clear that the provisions of moratorium shall not apply to transactions which might be notified by the Central Government or the supply of the essential goods or services to the Corporate Debtor as may be specified, are not to be terminated or suspended or interrupted during the moratorium period. In addition, as per the Insolvency and Bankruptcy Code (Amendment) Act, 2018 which has come into force w.e.f. 06.06.2018, the provisions of moratorium shall not apply to the surety in a contract of guarantee to the corporate debtor in terms of Section 14(3)(b) of the Code. 49. The Interim Resolution Professional shall perform all his functions contemplated, inter alia, by Sections 15, 17, 18, 19, 20 & 21 of the Code and transact proceedings with utmost dedication, honesty and strictly in accordance with the provisions of the C....