TaxTMI 
TaxTMI 
2020 (3) TMI 1209
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.... Heard counsels for the financial creditor and corporate debtor and perused the pleadings including the documents placed on file. 3. The financial creditor has claimed an amount of Rs. 236,35,93,324.86 (rupees two hundred and thirty six crores thirty five lakhs ninety three thousand three hundred twenty four and eighty six paisa only) as outstanding against the corporate debtor as on May 29, 2016 which the corporate debtor has failed to pay. 4. The brief facts of the case are that the corporate debtor is a company in the business of manufacturing M. S. Ingots having its factory at GNT Thurai Nallur Village, Ponneri, Taluk. The corporate debtor approached the financial creditor for sanction of various credit facilities for setting up of rolling mill and procuring raw materials, etc. In the year 2013, the financial creditor has sanctioned (i) Cash credit facility of Rs. 130 crores, (ii) Term loan of Rs. 6.34 crores (iii) Inland/import letter of credit of Rs. 65 crores and bank guarantees of Rs. 6 crores which were availed by the corporate debtor. 5. The corporate debtor vide its board resolution dated November 27, 2013 had accepted the terms of sanction of the credit limits ....
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.... Tribunal. 8. Besides above, counsel for the financial creditor has referred to the annual report of the corporate debtor for the year March 31, 2015 which is placed at pages 237 to 264 of the typed set filed with the application wherein the amount due to the financial creditor is acknowledged by the corporate debtor. 9. The financial creditor has also placed on record the statement of account in respect of each facility at page Nos. 75 and 76 of the typed set filed with the application. Further, the financial creditor has filed the certificate under section 2(A)(b) of the Bankers' Books Evidence Act, 1891 at page No. 81 of the typed set filed with the application. 10. It has been submitted by counsel for the financial creditor that on April 10, 2019 the corporate debtor has given proposal for one-time settlement of Rs. 50 crores and the same has been rejected by the financial creditor vide letter dated July 8, 2019. Copy of the rejection letter is placed on file. 11. In relation to the above application as preferred by the financial creditor/ applicant-bank, initially an M. A. No. 212 of 2018 has been filed by the corporate debtor seeking to challenge the initiatio....
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....36,35,93,324.86. In the circumstances, taking into consideration the claim being in excess of the amount claimed, this petition is liable to be dismissed by this Tribunal. In relation to each of the contention taken by the corporate debtor, it is necessary for this Tribunal to analyse the facts, which have been stated in the reply as well as the application which has been filed by the corporate debtor and which under the direction of this Tribunal needs to be treated as a reply to the main company petition. 12. In relation to contention No. 1, it is contended by the corporate debtor that the application has been filed based on the power of attorney dated May 15, 1997 and that no authorization letter dated October 8, 2018 has been enclosed along with the application nor the said authorization letter had been enclosed along with copy of the application and documents which were sent by the applicant-bank to the corporate debtor, as required under rule 4(3) of the I and B (AAA) Rules, 2016 and since the application served upon the corporate debtor is incomplete and in violation of the said Rules, the application is liable to be rejected. Further it was contended that the po....
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....in relation to the amount claimed by the applicant-bank. 14. In addition, it is also contended that the statement of account filed along with the application is not complete and the same stands for the period from February 25, 2017 to September 1, 2018 only, and also pertains only to the period after the alleged date of default. It is pointed in this regard that the revival letters, if at all which have been signed is three years prior to the date of filing of this company petition. It is also projected that in relation to each of the proceedings initiated by the applicant-bank be it before the Debts Recovery Tribunal or under the I and B Code, 2016, the period of limitation is to be reckoned in relation to each of the proceedings and hence the proceedings under the Debts Recovery Tribunal may be within limitation, however, in relation to the I and B Code, 2016 and the above application, it is not within the period of limitation. A plethora of judgments have been relied on including, inter alia, the decision of the hon'ble Supreme Court as rendered in : (i) B. K. Educational Services P. Ltd. v. Parag Gupta and Associates [2018] SCC Online SC 1921 ; [2019] 212 Comp C....
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....disclosing a credit of Rs. 14,85,00,000 to the account of the corporate debtor on March 28, 2018 prior to the filing of the instant application in the month of October, 2018 and which fact had also been taken note off in the judgment dated October 9, 2018 in W. P. No. 7185 of 2018 at the time of disposal of the writ petition more particularly at paragraph 28 of the said judgment. (iv) Offer by the corporate debtor dated April 10, 2019 to an one-time settlement, while the instant petition was pending before this Tribunal in a sum of Rs. 50 crores which stood rejected by the financial creditor vide letter dated July 8, 2019. Clauses (i) to (iv) above clearly points out to an existence of a financial debt owed to the financial creditor, as defined under section 5(8) of the I and B Code, 2016, by the corporate debtor in excess of Rs. 1,00,000 and the repayment of which there is a default as envisaged under section 3(12) of the I and B Code, 2016. 17. Even though across the bar judgments in relation as to whether amounts disclosed in the balance-sheet/financial statements can be considered as an acknowledgment of debt or not in relation to the earlier dispensation o....
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....ited in two instalments. 20. In relation to the above contention put forth by the corporate debtor about multiplicity of proceedings, it is by now trite that despite proceedings pending before the Debts Recovery Tribunal, this Tribunal designated as an Adjudicating Authority in relation to corporate persons under the I and B Code, 2016 can entertain an application filed by a financial creditor in case of a "financial debt" and "default in existence" and in the circumstances we are unable to consider the said ground having any force. 21. It is also highlighted in the application/reply as filed by the corporate debtor that a counter claim as stated above has also been filed by the corporate debtor by virtue of Application Nos. 325 and 326 of 2018 before the hon'ble High Court of Judicature at Madras and the order passed thereunder dated August 7, 2018 and the counter claim has been taken on file to be considered by the Debts Recovery Tribunal and taking into consideration the above counter claim by the respondent/corporate debtor the application as filed by the applicant-bank is likely to be rejected. However, we are also not convinced by the above ground, namely, that of a....
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....ocess in relation to the corporate debtor in terms of the provisions of the I and B Code, 2016. 24. As a consequence of the application being admitted in terms of section 7 of the Code, moratorium as envisaged under provisions of section 14(1) and as extracted hereunder shall follow in relation to the corporate debtor : "(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 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." 25. However during the pendency of morato....