TaxTMI 
TaxTMI 
2020 (6) TMI 737
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.... of convenience. 2. These brief facts of the case are as follows: The Appellant is the suspended Director of the Corporate Debtor Shree Sai Prakash Alloys Private Limited which availed certain credit facility from the Respondent Bank from time to time in 2014. The alleged default occurred on 12th May 2015. 3. It is contended that the Respondent Bank/financial creditor had filed Application before the Adjudicating Authority (NCLT), Guwahati Bench under Section 7 of the I&B Code claiming amount of Rs. 84,46,17,450.68. The Petition was filed on 19th May 2018 and date of default as mentioned in the Application is 12th May 2015. Therefore, as per Respondents own admission, the Petition is filed beyond a period of three years. 4. The Appellant contends that during the pendency of the Petition Respondent Bank entered into OTS. However, the Respondent Bank did not withdraw the Petition and suddenly on 29th July 2019 issued a letter asking them to deposit the balance amount as per terms of OTS. But later on, another notice about the revocation of OTS was sent on 31st July 2019. The corporate debtor received the said letter on 07th August 2019. 5. The Appellant pleaded that th....
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....voked the OTS on 31st July 2019 and the same was also conveyed to the Appellant. 9. It is further contended that during the pendency of the Appeal, the Appellant again approach the Respondent Bank for the revival of the OTS by tendering cheque of Rs. One Crore as part payment towards OTS on 10th October 2019. Since the offered amount was too low, and the Appellant had earlier failed to comply with the terms and conditions of the OTS; therefore, the Bank did not consider OTS again. 10. The Respondent Bank has admitted in the Written Submissions, "that the Appellant admitted the liabilities of all the three Companies by submitting a consolidated OTS for an amount of Rs. 60 Crores with the Respondent Bank which was sanctioned by the Bank on 27th December 2018. The same was also accepted by the Appellant on 10th January 2019. However, the Appellant failed to adhere to the terms and conditions of the OTS. As such, the Competent Authority of the Bank revoked the OTS on 31st July, 2019 and the same was also conveyed to the Appellant". 11. It is further stated in the Written Submissions of the Respondent "that during the pendency of the present proceedings, the Appellant again app....
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....ing against the proposed resolution professional, it may, by order, reject such Application: Provided that the Adjudicating Authority shall, before rejecting the Application under clause (b) of sub-section (5), give a notice to the applicant to rectify the defect in his Application within seven days of receipt of such notice from the Adjudicating Authority. (6) The corporate insolvency resolution process shall commence from the date of admission of the Application under sub-section (5). (7) The Adjudicating Authority shall communicate- (a) the order under clause (a) of sub-section (5) to the financial creditor and the corporate debtor; (b) the order under clause (b) of sub-section (5) to the financial creditor, within seven days of admission or rejection of such Application, as the case may be." Section 7(5)(a) provides that where the Adjudicating Authority is satisfied that the default has occurred and the Application under Section (2) is complete and no disciplinary proceeding pending against the proposed Resolution Professional, it may, order, admits such Application. Therefore, a petition under Section 7 can be admitted by the Adjudicating Authority if it i....
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.... gained so much time on the pretext of settlement and also by filing Writ Petition before the Hon'ble High Court of Meghalaya at Shilong and it is high time to put an end to this matter. 19. It is undisputed that by order of the Hon'ble High Court dated 19th August 2019 parties were directed to maintain status quo till 26th August 2019. However, the Adjudicating Authority, without taking the status quo of the High Court, passed the Order of Admission on 23rd August 2019. 20. The Appellant contends that the Petition is barred by Limitation Act. The loan is sanctioned in 2004, various enhancement up to 11th June 2012, and alleged restructuring happened on 25th July 2014, whereas the Petition was filed on 09th July, 2018. Therefore, the claim of the Respondent Bank is time barred. In this connection it is further contended by the Appellant that date of default as shown in the Form 1 is 12th May 2015 and Petition is filed on 09th July 2018. Therefore, on this basis petition is time barred. 21. It is important to mention that Appellant has annexed a letter Annexure A4 dated 03rd March 2018, wherein it is stated that: "Now, by arranging fund from our friends and relatives as ....
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.... dated 29th July 2019 which is at page 99 of the paper book. This letter shows that Bank has addressed a letter to the Directors of all the three companies informing that; "As per the terms of the conditions of above OTS, you have to deposit Rs. 3/- Crores as upfront, Rs. 3/- Crore immediately after receiving of sanction letter and minimum of Rs. 1.50 Crore in each month. But it is a matter of concern that after lapse of more than 6 months, you have deposited Rs. 6.79/- Crores against due amount of Rs. 16.50 Crores till July 2019." 25. It is also clear from the letter mentioned above that the OTS proposal dated 06th August 2018 of Rs. 60/- Crores in group account was accepted by the Bank on 27th December 2018 and the Corporate Debtor has paid Rs. 6.79 Crores in furtherance of the OTS. It is also on record that the Respondent Bank has further accepted a sum of rupees One Crore on 21st August 2019 regarding renewal of OTS. The cheque dated 21st August 2019 was encashed by the Bank even after revocation of the OTS during pendency of Section 7 of the Application. 26. On perusal of the record it is apparent that after acceptance of OTS for settling the dues of all the three com....