TaxTMI 
TaxTMI 
TaxTMI 
2019 (2) TMI 1847
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....nds. 2. The averment in brief for the consideration of the application is the following:- The Corporate Debtor availed a credit facility from the Financial Creditor initially in the year 2014 by creating mortgage over the immovable properties to secure repayment of the entire principal advanced by the Financial Creditor along with interest, costs and expenses accrued thereon. The Corporate Debtor availed a Term Loan of Rs. 15.00 crores (Rupees Fifteen Crores) and Cash Credit (Hypothecation) Limit of Rs. 3.00 crores (Rupees Three crores) aggregating the credit facilities to the extent of Rs. 18.00 crores (Rupees Eighteen Crores), The Financial Creditor sanctioned the loan as per the sanction letter dated 21.06.2014. Guarantors of the Corporate Debtor also executed Letter Of Guarantee in their respective personal capacity as guarantors in favour of the Financial Creditor. As per the authorization by the authorised representative of the Corporate Debtor in pursuance to its Board Resolution the loan documents were executed on 04.09.2014. On availing the credit facilities the Corporate Debtor created charge in respect of the credit facilities to the extent of Rs. 18.00 crores granted ....
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....as compelled to issue demand notice on 19.02.2016 under Section 13(2) of the SARFAESI Act, 2002, to the Corporate Debtor and its guarantors through its authorised Officer and the same was also sent to the Corporate Debtor and its guarantors through Speed Post with A/D. 7. The Corporate Debtor had availed loan from ICICI Bank as well as from the Financial Creditor and have entered multiple banking arrangement. When the account slipped into NPA, ICICI bank assigned its debt with the all underlying securities to M/S. J.M. Financial Assets Reconstructions Company Pvt. Ltd., Prabhadevi Mumbai with certain terms and conditions as stated in the Deed of Assignment and accordingly intimated to the Financial Creditor by its letter dated 12.10.2016. 8. The Financial Creditor filed an original application being O.A. No. 14 of 2016 before the Learned Debt Recovery Tribunal at Jabalpur on or about 09.12.2016 for a claim of Rs. 21,87,30,089.00/- ( Rupees Twenty One Crores Eighty Seven Lacs Thirty Thousand and Eighty Nine Only) with further interest and cost which is still pending for final adjudication. 9. In spite of receipt of the above demand notice dated 19.02.2016, the Corporate Debtor fa....
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....ent dated 04.09.2014, Master undertakings dated 04.09.2014, Agreement for Pledge of Shares dated 04.09.2014, Letter of Consent dated 04.09.2014, Consent letter dated 04.09.2014, Security Trusty Agreement dated 04.09.2014, Document in respect of mortgage, Acknowledgement of Creation of equitable mortgage, Letter dated 27.08.2014, Agreement for Hypothecation of movable assets forming part of fixed/block assets dated 04.09.2014 - collectively marked as Annexure 'J'. (k) Agreement of Guarantee dated 04.09.2014 executed by Smt. Pinki Gupta and Smt. Neelam Devi Gupta - marked as Annexure Agreement of Guarantee of Mr. Sanjay Gupta, one of the directors of the Corporate Debtor, dated 04.09.2014 - marked as Annexure (m) Letter ceding pari passu charge dated 27.08.2014 - marked as Annexure 'M'. (n) Notice under section 13(2) dated 19.02.2016 - marked as Annexure 'N'. (o) Letter dated 12.10.2016 - marked as Annexure 'O'. (p) Original application being O.A. No. 14 of 2016 - marked as Annexure 'P'. (q) Possession notice under section 13(4) dated 16.09.2017 marked as Annexure 'Q'. Upon the aforesaid contentions and on the strength of the above referred d....
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....Applicant Bank. The steps taken by the applicant bank which includes declaring the account of the said Company as NPA is the subject matter for the proceeding in the instant applicant as well bad in law is under challenge before the Learned Debt Recovery Tribunal, Jabalpur by way of SA No. 246 of 2018 which is an appropriate forum. 15. In view of such pending adjudication in a proceeding which has been filed prior to the filing of the instant application before an appropriate forum of law, no further steps should be taken by the Hon'ble Bench to proceed with the said application since it may amount to conflict of judgement which is effect affect the judicial propriety and discipline. 16. Mr. B. Parvateeswara Rao is not an authorized person to submit this application on behalf of the applicant. Whether he is still in service is also not sure. The Power of Attorney was executed on 13.12.1990 and the instant application has been filed in February 2018. There is no recent power of attorney or Board Resolution executed by the applicant in support of Mr. B. Parvateeswara Rao, who has been described as a person authorized to present such application on behalf of the applicant. In vi....
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....ere able to rotate the business and repay the loans in other projects, 23. Company has repaid huge interest on the limit granted by bank and has repaid sizeable portion of term loan granted by ICICI bank and PNB. From 2012 to 2015 the CMVPL has paid principal and interest to the Banks to the tune of Rs. 46.73 crores. In addition to above banks have recovered huge amount on account of bank charges for providing various services to the company. Company and promoters have invested Rs. 174 crores towards making of fixed assets as margin, thus, if overall financial data is examined, the picture which would emerge is that approximately 15.29 crores of the size of loan has been repaid by company to Bank. Company has been providing livelihood to approximately 220 families by operating the Mall & Hotel. 24. In the aforesaid facts the Company should not be declared Bankrupt or Insolvent. It is in the said background the Punjab National Bank issued demand notice dated 19.02.2016 under section 13(2) of the Securitisation Act and demanded Rs. 19,14,42,565.60/- (Rupees Nineteen Crores Fourteen Lakhs Forty Two Thousand Five Hundred Sixty Five and Paise Sixty Only). 25. The Corporate Debtor iss....
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.... Mr. B. Parvateeswara Rao, the applicant has proper authority to Institute an application of this nature? (b) Whether the application is maintainable in view of the Interim order passed by the Hon'ble High Court of Chattisgarh, Bilaspur in Writ Petition (C) No. 1686 of 2017. (c) Reliefs and cost? Point No (a):- 30. Punjab National Bank/FinanciaI Creditor has filed the application u/s 7 of I&B Code, for initiating Corporate Insolvency Resolution Process as against M/S. City Mall Vikash Pvt. Ltd./Corporate Debtor. The facts regarding availing credit facility from the Financial Creditor by executing Term Loan Agreement dated 04.09.2014 (Annexure 'J'), Supplemental Agreement dated 04.09.2014 (Annexure 'J') and execution documents like Agreement of Hypothecation of assets to secure Term Loan dated 04.09.2014 etc is not in dispute. The Corporate Debtor admittedly availed a term loan and credit facilities to the extent of Rs. 18.00 crores (Rupees Eighteen Crores) in total. Though the Corporate Debtor has contented in the reply affidavit that there is no default as alleged by the Financial Creditor, the documents produced on the side of the Applicant/Financial Cre....
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....the debtors of the said Bank, to appear and act in court of insolvency and Liquidation Judge and before the Official Receiver and Liquidator, to tile claims prove debts of the said Bank in the insolvency and liquidation court and before the Official Receiver or Liquidator to oppose discharge of the insolvent and to collect/ receive dividend declared by the insolvency or liquidation court in respect of any insolvency or liquidation case". 33. The Bank Managers are given power to initiate Insolvency proceedings and as per the Power of Attorney and in support Of the delegation of powers given to the applicant Manager the applicant also produced a Letter of Authority (Annexure As per the Letter of Authority dated 15.02.2018 the Deputy General Manager of Punjab National Bank has been given Special Authority to the applicant Mr. B. Parvateeswara Rao to file Corporate Insolvency Resolution process u/s 7 of the I&B Code 2016. It is good to read the authority which has been given to Mr. B. Parvateeswara Rao, which is reproduced below:- "This is to certify that Shri B. Parvateeswara Rao, Son of Late B. Bhoolokam (P.F. No. 59208) aged about 55 years, at present posted as Assistant General M....
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.... is in force and since the writ petition is pending for adjudication before the Hon'ble High Court at Chattisgarh, Bilaspur, the adjudicating authority could not proceed with the assets of the Corporate Debtor and therefore there is a bar in initiating Corporate Insolvency Resolution Process (CIRP) as against the Corporate Debtor. 36. A reading of the Interim Order referred to above it appears to me that it does not expressly restrict the applicant from initiating CIRP process under Section 7 of the Insolvency and Bankruptcy Code 2016. What I understood is that dealing with the assets of the Corporate Debtor which has been taken symbolic possession by the Financial Creditor is to be dealt with in accordance with the provisions of SARFAESI Act and sub Rules 3 & 4 of Rule 8 of the SARFAESI Rules 2002. 37. No order restraining the Adjudicating Authority from dealing with the property issued in the said order is brought to my notice . According to the Ld. Sr. Counsel in view of such pending adjudication in a proceeding which has been filed prior to the filing of the instant application before an appropriate forum of law, no further steps should be taken by the Hon'ble Bench t....
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.... produced the copy Of CIBIL Report (Annexure for strengthening the contentions on the side of the Financial Creditor that the Corporate Debtor is a defaulter and also produced the copy of ledger accounts maintained in the accounts of Corporate Debtor which shows that the Corporate Debtor is not regular in repayment and as on 07.12.2016 the balance outstanding due to the Financial Creditor is Rs. 21,87,30,089.00/- (Rupees Twenty One crores Eighty Seven Lakhs Thirty Thousand Eighty Nine Only). 41. Being succeeded in proving default in repayment Of the loan amount by the Corporate Debtor the next question is whether the Financial Creditor succeeded in proving the compliance of requirement of the Act in order to maintain the application of this nature. 42. As per Section 7(3) of the Code the Financial Creditor shall, along with the application furnish record of the default recorded with the information utility or such other record or evidence of default. It is one among the requirement which would be meted out by the Financial Creditor and that requirement has been meted out though a Certificate from Information Utility Organization has not been produced. 43. The 2nd requirement as ....