TaxTMI 
TaxTMI 
2018 (11) TMI 1781
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.... that the Respondent defaulted in making payment of a sum of Rs. 273,09,68,793/- as on 31.03.2018, including interest and the date of default being 11.02.2010. 2. Before going into the Petition filed by PNB, let us discuss about the Intervention Applications filed by the Promoters (hereinafter collectively referred to as "Interveners") in M.A. No. 1156 of 2018 and I.A. No. 1277 of 2018. Since the prayer in both these applications is similar a common order is passed in both these applications. i. The Interveners in the above applications are the promoters of the Corporate Debtor and submits that; in the year 2005 owing to various factors the Corporate Debtor had suffered losses and consequent erosion of working capital, triggered Corporate Debt Restructuring, there were some labour problems in the year 2008, reference under section 15 of Sick Industrial Companies Act (SICA) was made in the year 2008 and declared as Sick Industrial company in the year 2009, etc. Now the Interveners in M.A 1156/MB/2018 herein have filed a writ petition no. 3430/2018 on the file of Hon'ble Bombay High Court with a grievance that the Petitioner had not strictly followed the RBI circular date....
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....istered office of the corporate debtor. The speed, within which the adjudicating authority is to ascertain the existence of a default from the records of the information utility or on the basis of evidence furnished by the financial creditor, is important. This it must do within 14 days of the receipt of the application. It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the "debt", which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed to the financial creditor and corporate debtor within 7 days of admission or rejection of such application, as the case may be." 4. From the aforesaid decision....
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....6, 02.05.2006, 10.03.2008 and 30.12.2008. ii. Statement of account & interest calculation sheet. iii. Copy of Deed of mortgage dated 24.05.2005. iv. Copy of Term Loan Agreement dated 28.03.2005 and 02.02.2006. v. Copy of Short Term Loan Agreement dated 17.10.2005 and 08.05.2006. vi. Copy of Demand Promissory Note dated 28.03.2005 for Rs. 20,00,00,000/-. vii. Copy of Agreement of Funded Interest Term Loan dated 25.03.2008. viii. Copy of Working Capital Term Loan Agreement dated 25.03.2008. ix. Copy of Agreement of Pledge dated 28.03.2008. x. Copy of Indenture of Mortgage dated 29.04.2009 and copies of Agreement of Guarantee dated 05.05.2006, 25.03.2008, 30.12.2008 and 31.12.2008. xi. Certificate of registration of modification of mortgage dated 24.09.2008. 9. PNB had issued notice u/s 13(2) of SARFAESI Act, 2002 on 31.12.2016 claiming a sum of Rs. 78,31,57,403/- as on 11.02.2010, 12.02.2010 and 20.05.2010 with further interest at contractual rate until full payment is made. 10. The Petition further reveals that the following is the outstanding as on 31.03.2018: Sr. No. Nature of ....
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....010 to 31.03.2018, this contention of the Corporate Debtor fails. Further, it is to be noted that even if there is some calculation mistake in the statement of account, the Corporate Debtor is entitled to bring it to the notice of the Insolvency Resolution Professional, who will take a call on the issue while admitting the claim of the Petitioner, as decided by Hon'ble NCLAT in the case of "Mr. Satyaprakash Aggarwal & Ors. V. Vistar Metal Industries Pvt. Ltd." [2018 SCC OnLine NCLAT 264] at para 4 of the judgement which reads as below: "4. Further, in a petition under Section 7 of the 'I&B Code', the Adjudicating Authority is required to decide whether the Form 1 along with documents is complete or not. The Adjudicating Authority is not required to decide as to what is the actual amount of claim and other details, which is required to be determined by the 'Resolution Professional' after initiation of 'Corporate Insolvency Resolution Process'." f. The Corporate Debtor contends that Particulars in Part 4 of Form 1 are incorrect, insufficient and devoid of merit and therefore the Petition is not maintainable. Since the Petitioner has provided the details of loan sanc....
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.... admission of this Petition. However, the Petitioner is entitled to bring it to the notice of Insolvency Resolution Professional during the course of CIRP. j. The Corporate Debtor submits that the BIFR Order dated 16.07.2009 which states that, the Corporate Debtor had become a sick industrial company, does not adjudicate on the default of the Corporate Debtor. It is further submitted that the Petitioner is trying to mislead this Bench as if default is approved by the BIFR. The common parlance is that when a company files a reference with BIFR then debt and default is accepted by the concerned company. In view of this, the contention of the Corporate Debtor that default is not proved just because an order is passed by BIFR admitting a company as a sick industrial unit is totally incomprehensible and this contention need not be given any credence in view of our observation that debt and default is writ large in this case. k. The Corporate Debtor submits that CIBIL report annexed to the Petition categorised the accounts of Corporate Debtor as standard and there is no record of default. However, an ordinary scanning of the CIBIL report shows that it is not reflecting ....
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....e Petitioner neither acted in accordance with the various directions issued by BIFR, nor formulated Draft Rehabilitation Scheme, nor accepted the revival plan cum-OTS proposal, nor communicated the acceptable counter proposal to obtain necessary consent of other stakeholders, nor took into account the effect of RBI circular dated 12.02.2018 in its true letter and spirit, though the Petitioner has accepted and agreed upon the OTS proposal submitted by the Corporate Debtor on 04.08.2018 and has filed this proceedings under Section 7 of Insolvency and Bankruptcy Code. There is nothing on record to suggest that the OTS proposal was accepted by the Petitioner and in fact the OTS proposal was rejected by the Petitioner on 31.10.2018 as disclosed by the counsel for the Petitioner during the hearing of this petition. Further, as mentioned supra this Bench had permitted the Corporate Debtor to submit the OTS proposal as requested by the promoters but the promoters failed to submit the OTS proposal as per the existing guidelines applicable for submission of OTS proposal. Hence the Corporate Debtor cannot raise this objection regarding the OTS proposal. 13.The contentions raised by the Cor....
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....ng Authority, on perusal of the documents filed by the Creditor, is of the view that the Corporate Debtor defaulted in repaying the loan availed and also placed the name of the Insolvency Resolution Professional to act as Interim Resolution Professional and there being no disciplinary proceedings pending against the proposed resolution professional, therefore the Application under subsection (2) of section 7 is taken as complete, accordingly this Bench hereby admits this Petition prohibiting all of the following of item-I, namely: (I) (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 Ac....