TaxTMI 
TaxTMI 
2020 (7) TMI 515
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....er the provisions of the Companies Act, 1956, CIN : U36990GJ2009PLC056869, having its registered office at Setu, Suite 303-4-5, Ship Cross Road, Off C. G. Road, Navrangpura, Ahmedabad-380 009, Gujarat. 3. The authorised share capital of the corporate debtor company is Rs. 5,00,00,000 (rupees five crores only) divided into 50 lakhs equity shares of Rs. 10 each and paid-up share capital is Rs. 5,00,00,000 (rupees five crores only) divided into 50 lakhs equity shares of Rs. 10 each. 4. The petitioner states that various loan/credit facilities have been granted to the corporate debtor. The details/particulars thereof and the total outstanding debts are described well in the prescribed format of the present application, which are stated as under : Part IV Particulars of financial debt 1. Total amount of debt granted Date of last sanction/renewal : 28-03-2013 vide Sanction letter No.VAD/ADV/549/13 Date(s) of disbursement CC Hyp. Date of disbursement Amount (Rs.) 30-12-2009 28,50,00,000 LC/LG Date of disbursement Amount (....
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....ecuted various security documents, in favour of the petitioner-bank (financial creditor), which are annexed with the present IB petition, and described as under : Part V Particulars of financial debt (documents, records and evidence of default) 1. Particulars of security held, if any, the date of its creation, its estimated value as per the creditor : (i) Hypothecation agreement of goods and debts (SD-06) was executed on March 29, 2013 to the extent of Rs. 48,46,00,000. Total value of plant and machinery assessed at about Rs. 6,05,90,000 as per valuation report dated December 30, 2017, annexure A/24. (ii) Equitable mortgage registered with the Sub-Registrar, Ahmedabad-3 (Memnagar) bearing No. 9260 dated September 30, 2009 for Rs. 31,10,00,000 created on the immovable properties jointly belonging to (i) Mr. Champatbhai Rikhabhai Sanghvi, and (ii) Mr. Deepak Champatbhai Sanghvias described in Schedule A of this application, annexure A/18. (iii) Equitable mortgage registered with Sub-Registrar, Ahmedabad-3 (Memnagar) bearing No. 8255 dated June 14, 2010 for Rs. 31,10,00,000 created on the immovable properties jointly belonging to t....
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....ents as stated in the resolution. (2) Letter dated March 29, 2013, from the corporate debtor regarding various undertakings to the applicant. (3) Letter to be obtained from the directors in cases where advances have been permitted to private limited/limited companies (AD-10). (4) Demand promissory note dated March 29, 2013, for Rs. 28,50,00,000. (5) Demand promissory note dated March 29, 2013, for Rs. 8,00,00,000. (6) Demand promissory note dated March 29, 2013, Rs. 1,11,00,000. (7) Demand promissory note dated March 29, 2013, Rs. 6,40,00,000. (8) Demand promissory note dated March 29, 2013, for Rs. 14,45,00,000. (9) Composite deed of hypothecation (SD-20) dated March 29, 2013, for Rs. 48,46,00,000 executed by the corporate debtor. (10) Hypothecation agreement of goods and debts (SD-06) dated March 29, 2013, for Rs. 48,46,00,000 executed by the corporate debtor. (11) Letter of undertaking not to alienate hypothecated goods (AD-12) dated March 29, 2013, for Rs. 48,46,00,000. (12) Letter of continuity (AD-09) dated March 29, 2013 for Rs. 28,50,00,000. (13) Text of the consent c....
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....y five and paise twenty eight only) inclusive of unpaid interest + penalty and other expenses up to September 30, 2018. 10. In the light of above stated statutory provisions and by perusal of the record, it goes to show that the present IB petition has been filed by the petitioner-financial creditor, through its authorized signatory, namely, Mr. Rajesh Kumar Mishra, Chief Manager, Union Bank of India, Asset Recovery Branch, Ahmedabad, he has filed an affidavit in support of the present petition. The relevant paragraphs of the said affidavit are stated as under : "5. I say that the corporate debtor, vide letter dated August 5, 2015, requested the applicant for allowing operations on cutback basis. The applicant has approved provision of cutback facility of 20 per cent. on credit turnover in the month of September, 2015 subject to the terms and conditions conveyed vide letter dated August, 12, 2015 (acknowledged by the corporate debtor on August 13, 2015). As per the said terms accepted by the corporate debtor, corporate debtor has opened a new CD account in Vadaj Branch of the applicant and started the operations and agreed by the corporate debtor, 20 per cent. of the cr....
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....rchangeability of Rs. 500 lakhs to CC(H) limit, LG at existing level of Rs. 100 lakhs, CC(H) limit was enhanced from Rs. 700 lakhs to Rs. 1550 lakhs, PC/PDBP limit of Rs. 300 lakhs, term loan at outstanding level 1064 lakhs and sanction of fresh term loan of Rs. 250 lakhs. 10. I say that subsequently, the corporate debtor faced trouble in production activities and liquidity crunch resulting into excess/over due in the accounts. Hence, the import L/C of Rs. 240 lakhs was devolved and paid by opening devolved L/C loan account. 11. I say that in September 2012, at the request of the corporate debtor vide FGMO Note No. FGMO/ADV/262/(B) dated September 28, 2012, the credit facilities of the corporate debtor were restructured by sanctioning WCTL of Rs. 640 lakhs comprising of irregular portion of Rs. 205 lakhs from CC account, overdue (instalment + interest) of Rs. 180 lakhs of term loans-I and II and LC devolved of Rs. 240 lakhs. 12. I say that despite restructuring of limits, the corporate debtor failed to serve the interest to the desired extent and overdue instalments of term loans and hence, the account of the corporate debtor was classified as non-perform....
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....of the default recorded with the information utility or such other record or evidence of default as may be specified ; (b) the name of the resolution professional proposed to act as an interim resolution professional ; and (c) any other information as may be specified by the Board. (4) The Adjudicating Authority shall, within fourteen days of the receipt of the application under sub-section (2), ascertain the existence of a default from the records of an information utility or on the basis of other evidence furnished by the financial creditor under sub-section (3). (5) Where the Adjudicating Authority is satisfied that- (a) a default has occurred and the application under sub-section (2) is complete, and there is no disciplinary proceedings pending against the proposed resolution professional, it may, by order, admit such application ; or (b) default has not occurred or the application under sub-section (2) is incomplete or any disciplinary proceeding is pending against the proposed resolution professional, it may, by order, reject such application : Provided that the Adjudicating Authority shall, before rejecting the a....
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....alment amount. For the meaning of 'debt', we have to go to section 3(11), which in turn tells us that a debt means a liability of obligation in respect of a 'claim' and for the meaning of 'claim', we have to go back to section 3(6) which defines 'claim' to mean a right to payment even if it is disputed. The Code gets triggered the moment default is of rupees one lakh or more (section 4). The corporate insolvency resolution process may be triggered by the corporate debtor itself or a financial creditor or operational creditor. A distinction is made by the Code between debts owed to financial creditors and operational creditors. A financial creditor has been defined under section 5(7) as a person to whom a financial debt is owed and a financial debt is defined in section 5(8) to mean a debt which is disbursed against consideration for the time value of money. As opposed to this, an operational creditor means a person to whom an operational debt is owed and an operational debt under section 5(21) means a claim in respect of provision of goods or services. When it comes to a financial creditor triggering the process, section 7 becomes relevant u....
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....atisfies the requirement of section 3(11) and (12) of the Insolvency and Bankruptcy Code for triggering the corporate insolvency resolution process in respect of the corporate debtor-company. 17. On perusal of the record, it is undisputedly established that the petitioner-financial creditor duly sanctioned and have disbursed various loan facilities to the corporate debtor and the same were availed of and utilized by it. The corporate debtor also confirmed its debts liability, through onetime settlement by offering Rs. 1,600 lakhs to the petitioner by its letter dated December 7, 2017 which could not be materialized. The corporate debtor was irregular in making repayment of its loan and the last payment was made by it on May 31, 2017. Hence, the present IB petition is found to be filed well within limitation and maintainable. 18. Consequently, this Adjudicating Authority hereby admits the IB petition filed under section 7 of the Insolvency and Bankruptcy Code, 2016, for initiation of the corporate insolvency resolution process, in respect of the corporate debtor. Further this the Adjudicating Authority declares moratorium under section 14 of the Code, with following orders and....