TaxTMI 
TaxTMI 
TaxTMI 
2020 (7) TMI 205
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.... Power Limited). 2. Brief facts as averred in the present Petition are as under: 2.1 That the Financial Creditor has filed the instant Application to initiate corporate Insolvency Resolution Process against the Respondent (Corporate Guarantor) in view of the default committed by the Principal Borrower to whom Financial Creditor had forwarded finances under various heads and for which transactions, the Respondents herein had given Corporate Guarantee with respect to the debt granted by the Financial Creditor. 2.2 That, "Athena Chhattisgarh Power Limited" (Principal Borrower) is a Joint Venture Company which is promoted by "Athena Energy Ventures Private Limited". 2.3 That, originally Principal Borrower pursuant to its Board of Directors meeting had decided to avail financial assistances from the financial institutions and Financial Creditor in the year 2011 with a request to provide financial assistance to it, and the Financial Creditor had provided financial assistance. 2.4 That, thereafter the Principal Borrower had approached the Financial Creditor and also several other Banks and basing upon discussions, a Consortium comprising of various banks including Financial Credi....
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....Application under section 7 of Insolvency & Bankruptcy Code, 2016 seeking initiation of Corporate Insolvency Resolution Process against the Corporate Guarantor/ Respondent herein. Since, the earlier proceedings against Principal Borrower were filed before this Adjudicating Authority, the instant Petition was also filed before this Adjudicating Authority only even though the registered office of the Corporate Guarantor was situated at New Delhi by virtue of provisions of the Code contained in Section 60(2) of the Insolvency & Bankruptcy code, 2016. 3. Counsel for the Respondent filed counter inter-alia stating as under: 3.1 That the Financial Creditor has earlier filed an Application under section 7 of the I&B Code, 2016 against the Principal Debtor before this Adjudicating Authority vide CP(IB)No.616/7/HDB/2018 and this Adjudicating Authority admitted the above said Company Petition. The present Company Petition is arising out of the very same transaction and the very same Common Loan Agreement dated 30.03.2011 as amended by a First Amendment Agreement dated 31.03.2015 followed by Second Amendment Agreement dated 01.09.2016 and as such, the very claim made under the presen....
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....arwal Vs. M/S Piramal Enterprises Ltd dated 0801-2019". 4.3 The other contention of the Corporate Debtor herein is that the Financial Creditor is a major shareholder in the Principal Debtor Company and as such cannot invoke provisions of Insolvency & Bankruptcy Code, 2016 against the Corporate Guarantor, 4.4 It is stated on behalf of the Applicant herein that, it is true and admitted fact that, the amounts as mentioned in the application filed under Section 7 of I & B Code, 2016 against the Principal Borrower vide CP (IB) No.616/07/HDB/2018 and the amounts mentioned in the application filed under the Section 7 of I&B Code, 2016 i.e., the present application are one and the same and also arise out of the same transaction and it is also an admitted fact that the Hon'ble National Company Law Appellate Tribunal had passed a Judgment that similar applications cannot be filed against Principal Borrower and Corporate Guarantor for the same amounts. However, upon perusal of the Judgment passed by the Hon'ble NCLAT, New Delhi, in the matter of "Dr. Vishnu Kumar Agarwal Vs. M/S Piramal Enterprises Ltd dated 08-01-2019, it is seen that Hon'ble NCLAT had made the below me....
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....taken any steps to get its Joint Venture Company to be taken out from such admission orders, the Corporate Guarantor now coming before this Adjudicating Authority and taking defense about Financial Creditor being major stake holder in Principal Borrower, is not a bar on this Adjudicating Authority from entertaining the present Application. 4.8. That, in an application under Section 7 of I & B Code, 2016 what a Financial Creditor has to satisfy the Adjudicating Authority is whether or not there was debt & whether the said amount is exceeding Rupees One Lakh and Secondly, whether a default was committed by the Principal Borrower? That apart, when a Section 7 application has been filed by the Financial Creditor against the Corporate Guarantor, what the Financial Creditor has to demonstrate is that a Corporate Guarantee has been given by the Corporate Guarantor to the loan transaction of the Principal Borrower. 4.9. That a perusal of the entire documents filed by the Financial Creditor would amply and clinchingly establish that it had forwarded amounts exceeding Two Thousand Seven Hundred Crores and that Principal Borrower had committed default in making the payments. F....
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....ainst the Corporate Guarantor must be filed after exhausting the rights against the Principal Borrower, as the Financial Creditor is also the Financial Creditor qua the Corporate Guarantor. 10. However, Hon'ble NCLAT have categorically laid down in the case of Dr. Vishnu Kumar Agarwal Vs. M/S. Piramal Enterprises Limited CA (AT) (Insolvency) No.347 of 2018 that since a Financial Creditor cannot make a claim for the same set of debt in two separate CIRP processes, he cannot be allowed to pursue two separate Sec. 7 applications for the same claim. If the CIRP is initiated against one of the Corporate Debtors, after such initiation the Financial Creditor cannot trigger CIRP against the other Corporate Debtor/ Corporate Guarantor for the same claim amount. In para 32 of their Judgement (supra) the Hon'ble NLCAT observed as under: "There is no bar in the 'I&B Code' for filing simultaneously two applications under Section 7 against the 'Principal Borrower' as well as the 'Corporate Guarantor(s)' or against both the 'Guarantors'. However, once for same set of claim application under Section 7 filed by the 'Financial Creditor' is admitted ....