AI Drafter 
TaxTMI 
TaxTMI 
2018 (3) TMI 1913
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....e, MIDC, Andheri (East), Mumbai City. The shareholding pattern is as under : "(1) Nominal share capital is Rs. 200,000,000,000, i. e., 500,00,00,00 equity shares of Rs. 10 each and 1500,00,00,00 cumulative redeemable preference shares of Rs. 10 each. (2) Paid-up share capital is Rs. 83,347,704,430, i. e., 243,243,243 equity shares of Rs. 10 each aggregating to Rs. 2,432,432,430 and 8,091,527,200 cumulative redeemable preference shares of Rs. 10 each aggregating to Rs. 80,915,272,000." 1.1 At the outset, the learned senior advocate Mr. Janak Dwarkadas has explained the necessity of submission of this application by the corporate debtor itself, to be declared as Insolvent, by referring February 12, 2018 Guidelines issued by Reserve Bank of India (RBI/2017-18/131) addressed to all Scheduled Commercial Banks and All India Financial Institutions. As per the Preamble of the said Guidelines, explanation tendered for issuance of the said Guidelines was that "The Reserve Bank of India has issued various instructions aimed at resolution of stressed assets in the economy, including introduction of certain specific schemes at different points of time. In view of the ....
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....t is expected to explain the "debt" and secondly to establish the "default". In this regard, an order has been pronounced by the hon'ble National Company Law Appellate Tribunal in the case of Leo Duct Engineers and Consultants Ltd. v. Canara Bank [2018] 2 C-C-OL 168 (NCLAT) (Company Appeal (AT) (Insolvency) No. 100 of 2017), order dated December 13, 2017 is referred wherein the conditions for admission of an application under section 10 of the Code are specified. The observation is that the Adjudicating Authority, on hearing the parties and on perusal of records, if satisfied, that there is a "debt" and there is a "default" occurred then has no option but to admit the application, unless the application is incomplete. In one of the case of Unigreen Global P. Ltd. v. Pun jab National Bank [2018] 1 C-C-OL 284 (NCLAT), Company Appeal (AT) (Insolvency) No. 81 of 2017, order dated December 1, 2017 the verdict says that AA is bound to admit application and not to reject on the ground of unrelated facts. Facts beyond the requirement of the said provision are not required to be pleaded. The restriction for admission is also prescribed in section 11 of the Code that certain persons are ....
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....tion is drawn that the hon'ble Delhi High Court has further directed, quote "It is clarified that the injunction is being passed against the respondent taking further steps" unquote. Hence it is pleaded that the respondent in the said case, i. e., M/s. Aircel Ltd., is stopped to take any further steps, which includes filing of the impugned application under section 10 of the Code. The operational creditor, viz., GTL Infrastructure Ltd., has a huge amount to recover, almost touching about 800 crores. A trade liability to be recovered from Aircel Ltd. If the application is admitted, then his right of recovery of about 800 crores shall get jeopardised. The financial creditors shall constitute a committee of creditors and vote in their favour; instead of supporting the claim of this operational creditor. It is pleaded that this petition do not deserve admission because the material fact about the pendency of High Court case has not been disclosed by the petitioner, therefore, the petition is malicious and defective due to non-filing of material facts. Further pleaded by Mr. Kamath that some time be granted because the operational creditor came to know about this petition recently, ....
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....nbsp; Secured facilities Sanctioned amount (Aircel Group Facility) Aircel Ltd. LC Buyer credit Bank guarantee Over dues Total State Bank of India 3,000 Punjab National Bank 400 813.63 4.03 272.49 433.86 1,524.01 Total 3,400 813.63 4.03 272.49 433.86 1,524.01 Unsecured facilities (backed by LOC from sponsor) Sanctioned amount facility** Aircel Ltd. Total Bank guarantees Standard Chartered Bank 343.06 343.06 343.06 *Pending reconcilitation with bank **Amount restricted to outstanding 2.3 The impugned application submitted under section 10 of the I and B Code also contains list of "operational creditors". Volumes Part-IV to Part- VII contains a very long list of operational creditors running from....
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....ptcy. The procedure of section 10 is to be applied to facilitate the restructuring of the stressed assets as well as to reorganize the finances of a defaulted company. For the purpose of reorganization and also for maximisation of value of assets due procedure is laid down in the Code and to achieve the said goal, the role of the National Company Law Tribunal is vital. Not only as an Adjudicating Authority but sometimes, National Company Law Tribunal is also functioning as a Supervisory Authority so that the provisions of this Code be successfully implemented. Specially when a resolution plan is submitted before the National Company Law Tribunal to record its satisfaction. The suggestions, if any, made while recording satisfaction play a crucial role for re-establishment of a stressed company for the years to come. In this regard, Eradi Committee report, Joint Committee Report of Lok Sabha, Parliamentary Debate, etc., have also been perused. My decision underneath is based upon the thorough study of the said reports and on due consideration of the stressed finances of this corporate debtor. 3.2 Before considering other aspects, at first it is worth to address the objection raise....
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....tions of the hon'ble Delhi High Court. An argument of a learned counsel representing SBI before the hon'ble court was that restructuring of the debt is a primary motive of consortium of bankers hence such a step is required to be taken hence respondent is free to move an application for modification of the impugned order, which was also allowed by granting liberty to bankers/SBI to take steps to exercise their rights as per law. Hence the hon'ble court was also not objecting for taking due steps if it is in the benefit of restructuring of the finances. That objective can be achieved by filing section 10 application. It is therefore not in contradiction of the order of the hon'ble Delhi High Court, but toeing the same line. 3.3 I am also of the view that under the changed circumstances when the RBI has issued Guidelines dated February 12, 2018 (supra) withdrawing several restructuring schemes, presently the only remedy available to a corporate debtor is to approach the National Company Law Tribunal. By this method as well, the ultimate motive is to restructure the stressed assets and to revive the revenue generation by inviting resolution plans. The procedure or t....
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....debtor company has enough valuable assets to satisfy the major portion of the outstanding debt. For reference, an estimated value of the assets is placed as under : Gross block (for assets as at December 31, 2017) Asset category AL ACL DWL ASML Total Licence fees/Spectrum 835276,15,061 2159,21,087 198807,99,458 - 1036243,35,606 Tangible and others 1049376,60,245 141531,91,134 1023442,40,901 21,17,000 2214376,09,280 Total 18846,52,75,306 1436,91,12,221 12222,50,40,359 25,17,000 3250619,44,886 6. To conclude, considering the voluminous evidences in 8 Volumes annexed along with the application and in the light of the provisions of section 10 of the Code I hereby hold that the conditions as prescribed under section 10 of the Code have duly been fulfilled. Since this is a petition of the "corporate debtor", therefore, the insolvency process shall commence as prescribed under section 10 of the IBC, 2016. On one hand the existence of financial debt as well as operational debt is proved, on the other hand the occurrence of "default" is also established. The corpor....
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....e case may be. (h) That the public announcement of the corporate insolvency resolution process shall be acted upon immediately as specified under section 13 of the Code. 9. Directions to IRP : That this Bench thus hereby appoints Mr. Vijaykumar V. Iyer, Registration No. IBBI/IPA-001/IP-P00261/2017-18/10490 as interim resolution professional (IRP) to carry out the functions as mentioned under the Insolvency and Bankruptcy Code. The so appointed IRP shall perform the duties as assigned under section 18 and under section 15 of the Code. The IRP shall inform the progress of the insolvency proceedings and submit the report of the compliance of the directions of this order within 30 days to this Bench. A liberty is granted to intimate even at an early date, if need be. 10. The preliminary pronouncement made on the date of hearing shall be part of this order and for ready reference reproduced below : "(1) The applicant is admittedly a corporate debtor and in that capacity moved the impugned application dated February 28, 2018 by invoking the provisions of section 10 of the Insolvency and Bankruptcy Code, 2016. Stated therein that huge loan facilities were availed, ....