TaxTMI 
TaxTMI 
2022 (6) TMI 623
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....ceived by the Appellant on 30.09.2021 and the Appeal has been filed before this Tribunal on 26.10.2021. 3. The Appellant is the Promoter, & Director of the Corporate Debtor(CD) - M/s Chadalavada Infractech Limited. The 1st Respondent - Financial Creditor is a State bank of India and the 2nd Respondent is a Resolution Professional (RP) representing the CD which has been admitted into CIRP vide the above stated order. 4. The Appellant has sought the following reliefs: a. To allow the Appeal and set aside the impugned order dated 23.09.2021 passed by the National Company Law Tribunal, Hyderabad Bench in CP(IB) No. 1/7/HDB/2020. b. To set aside the commencement of Corporate Insolvency Resolution Process initiated against the Corporate Debtor and appointment of the Interim Resolution Professional and all actions taken further to the impugned order dated 23.09.2021 etc. 5. The 1st Respondent -SBI has filed the petition under Section 7 of the Code stating that the CD has availed a loan facility for an amount of Rs.281.23 Crore. The CD was unable to repay the loan and the SBI in accordance with relevant banking provisions declared the loan facilities as 'Non-Perf....
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....from the acknowledgement of debt based on OTS proposal to the Financial Statement of the CD as on 31.03.2018 reflecting the debt outstanding towards the financial creditor/ SBI. However, the Financial creditor has not placed the same before the Adjudicating Authority nor this Tribunal. If it is looked from otherwise the acknowledgment of financial statements for the year 2018 will still miserable failed to establish within the purview of the Limitation Act considering that the limitation period ended on 14.03.2014. The Appellant has relied upon the various judgment as depicted below: * B.K.Educational Services Pvt. Ltd. Vs. Parag Gupta and Ors. MANU/SC/1160/2018 para 12 to 22, 30 & 34 to 42 * BabulaVardharjigurjar V.Veer GujarAluminium Industries Pvt. Limited & Ors. AIR 2000 SC 4668 paras 20 to 32, 35, 35.1, 38.1, 39.1, 39.3 & 40 * V.Hotels Limited Vs. Asset Reconstruction Company India Limited 2019 SCC Online NCLAT91 paras 17 to 28 * Sumeet Maheshwari V.Navbharat Press (Bhopal) Pvt. Ltd. and Ors. MANU/NL/0253/2020 paras 19, 23 t0 25 * Stressed Asset Stablization Fund Vs. Royal Bushes Pvt. Ltd. NCLAT New Delhi, Comp.Appeal (AT) (Ins) 949....
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....hin the period of limitation. It is submitted that this Appellate Tribunal, Principal Bench in Mr. Gauri Prasad Goenka Vs. Punjab National Bank & Anr. (Company Appeal (AT) (Ins) no. 28 of 2019) has held, as given below, that OTS is clear acknowledgement of debt: "10. That apart, there is acknowledgement of the outstanding debt on the part of the Corporate Debtor, a fact not disputed by the Corporate Debtor. This comes to fore from the letter dated 04th August, 2018 emanating from the Corporate Debtor and addressed to the Financial Creditor wherein the Corporate Debtor agreed to settle all outstanding dues of the Financial Creditor on OTS basis (refer pages 692-693 Vol.III of the Appeal Paper Book). This is a clear acknowledgment of the outstanding debt in writing and the Corporate Debtor cannot wriggle out of the liability so acknowledged. It is not in controversy that on the date of such acknowledgement, the debt was not time barred and the Insolvency Resolution Process was triggered within the period of limitation in terms of Article 137 of the Limitation Act, computed for such date..." 11. It is also submitted by the SBI/Respondent No.1 that Hon'ble Apex Court in Inn....
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.... creditor to initiate action under section 7 of the Code. However, Section 7 comes into play when the CD commits "default". Section 7, consciously uses the expression "default"-not the date of notifying the loan account of the corporate person as NPA. Further, the expression "default" has been defined in Section 3(12) to mean non-payment of debt when whole or nay part or instalment of the amount of debt has become due and payable and is not paid by the debtor or the corporate Debtor, as the case may be. In cases where the Corporate person had offered guarantee in respect of loan transaction, the right of the financial creditor to initiate action against such entity being a corporate debtor (corporate guarantor), would get triggered the moment the principal borrower commits default due to non-payment of debt. Thus, when the principal borrower and/or the (corporate) guarantor admit and acknowledge their liability after declaration of NPA but before the expiration of three years therefrom including the fresh period of limitation due to (successive) acknowledgements, it is not possible to extricate them from the renewed limitation accruing due to the effect of Section 18 of the Limitat....
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....ies are as follows: A. Fair market value Rs. 86.23 crore B. Realizable value of Rs.73.29 Crore C. Distress sale value of RS. 60.36 crore. 16. The CD has requested that vide its letter dated 15.07.2019 to consider favorably CD exit route through OTS amount of Rs.53 core against the realization value of 73.29 crore by increasing our offer from Rs.45 crores. The CD also requested the Bank /FC to adhere to the one-time settlement proposal and to permit to pay balance amount over a period of six months from the date of approval given by the Bank. It was also stated by the R1 that the Appellant raised the question of limitation rehabilitation letter issued by them and part payment paid by them satisfies the requirement in question of limitation. As the said letter and payment has been made in the period of 2011-12 and the letter 2013 which is admission of debt in itself will satisfy the question of limitation. It is pertinent to note the link letter and this Restructuring Agreement has been signed by the CD and that the CD has never challenged these two documents. The Bank has also attached with the Written Submission Statement of transaction for Account No.....
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.... handing over and assets and records and required information from the Promoters/Suspended Director to appoint valuers, prepare information memorandum to issue Expression of Interest report to Adjudicating Authority of preferential undervalued and fraudulent transaction under the provisions of the Code. 19. The Adjudicating Authority, while passing the impugned order dated 23.09.2021 has observed the followings: 20. We have carefully gone through the submissions made by the both the learned parties and extant provisions of the Code and we are having the following observations: a. It is undisputed fact that the Corporate Debtor has borrowed the funds from Respondent No.1 and the amounts claimed to be in default is approx. Rs. 216.95 Crore. b. Security held and certificate of registration of charges issued by Registrar of Companies is also not in dispute. c. The Corporate Debtor vide its letter dated 18.07.2011 requesting State Bank of India to allow to operate its accounts within a limit of Rs. 185 Crore approx. d. The petition was filed before the Adjudicating Authority on 25.11.2019 and the date of default is on 15.04.2011 which is due to ....
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....ing all amendments and waivers to date (attach a copy) A record of default as available with any credit Information company Copies of entries in a bankers book in accordance with the Bankers Books Evidence Act, 1891 (18 of 1891) (Attach a copy) List of other documents attached to this application in order to prove the existence of financial debt, the amount and date of default 1. Sanction Letter dated 10.05.2014 for total limits. of Rs. 157,27,00,000/- (Rupees One Hundred Fifty Seven Crores Twenty Seven Lakhs Only); 2. Letter from Corporate Debtor sanction of loan acknowledging bearing reference CIL/SAMB/2014-15/05-2 12.05.2014; No. dated 3. Restructuring Package Agreement dated 24.05.2014; 4. Letter regarding grant of individual limits within overall limits 24.05.2014; 5. Link letter dated 24.05.2014; dated 6. Pledge Agreement dated 28.11.2014; 7. Board Resolution of the Corporate debtor dated 24.05.2014; 8. Board Resolution of the Corporate debtor dated 14.07.2014; 9. Sanction Letter dated 24.12.2015 for total limits of Rs. 281,23,00,000/- (Rupees Tw....
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....य tz 4106 Document 4 State Bank of India, Branch: 04106 Statement of transactions for A/c No: 30043104575 94 Date Description 02-04-11 DISHONOUR CHEQ BrCd Withdrawal Deposit Balance 02-04-11 DISHONOUR CHEQ 3098 100.00 -574154793.36 02-04-11 DISHONOUR CHEQ 3098 100.00 -574154893.36 05-04-11 DISHONOUR CHEQ 3098 100.00 -574154993.36 05-04-11 DISHONOUR CHEQ 3098 100.00 -574155093.36 05-04-11 0505510LU0001789 TRF TO 0098343030980 / 3098 100.00 -574155193.36 5055 05-04-11 0505510LU0001789 TRF TO 0098741030987 1 01308202000001TF85015690143 3325.00 -574158518.36 5055 05-04-11 0505510LU0001789 TRF TO 2399963050550/ 01308414000001TF85015690143 75.00 -574156593.36 5055 1330139.00 01308000000014TF85015690143 -575488732.36 05-04-11 TRF TO 0098343030980/ 0505510LU0001604 5055 3472.00 -575492204.36 01308202000001TF85015690143 05-04-11 TRF TO 0098741030987 J: 0505510LU0001604 5055 75.00 -575492279.36 01308414000001TF85015690143 05-04-11 TRF TO 2399963050550 /: 0505510LU00016....
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....2.12.14 2500000.00 -195359414.06 31-12-14 02-01-15 TRF TO 0034035728095 /FITL-11 REPAYMENT VIDE REQ LR 29.12.2014 TRF TO 0034034155590 INTT FOR 13.08.2014 TO 31.10.2014 FOR FITLI RECOVE 2675000.00 -198034414.08 5904852.00 -203939266.06 02-01-15 TRF TO 0034035804238 /INTT FOR 13.08.2014 TO 31.10.2014 FOR WCTL RECOVER 4106667.00 -208045933.06 02-01-15 02-01-15 TRF TO 0032715446037 /TR O/A.REQ LR DT:30.12.14 & APPROVE NOTE 020115 TRF TO 0097889041069 /INT FITLII 1.11.14 TO 30.11.14 1483000.00 -209528933.06 2250373.00 -211779306.06 02-01-15 TRF TO 009788904 1069 INT WCTL 01.11.14 TO 30.11.14 1565074.00 -213344380.06 02-01-15 TRF TO 0097867041065 INTT REC 03.11.14 TO 31.12.14 3601717.00 -216946097.06 03-01-15 TRF TO 0099506044303 /NEFT 50562.00 -216996659.06 SBIN115003891908 R SUBRAMANIAN AND COMPANY 03-01-15 TRF TO 0032715446037 /TR VIDE REQ DT:03.01.2015 05-01-15 TRF FROM 3199855044301 /RTGS MAHBR52015010500620805 THE 4430 18 5000.00 -218801659.06 12374185.00 -206427474.06 MAHARASHTRA STATE 09-01-15 TRF FROM 00....
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....,104 46,88,01,936 34,14,05,110 32,04,00,653 34,17,38,263 6,28 38,080 6,33,36,980 Total: 121,38,42,096 149,39,10,925 121,52,82,289 146,79,10,726 012 10 11 12 2,23,84,731 8,08,50,366 2,66,19,195 7,58,85,729 1,31,590 10,31,52,687 1,88,479 10,26,93,403 13 14 15 18 17 34567 19,45,25,000 14,93,05,080 9,65,70,740 46,54,15,253 19,47,63,000 17,07,86,137 9,14,42,210 48,49,42,165 43,14,00,775 47,68,25,201 Tolal: 139,07,58,238 149,39,10,925 136,52,17,323 148,79,10,728 26 For CHADALAVADA INFRATECH LTD., Managing Director ch.v Director Document 7 The RP circulated the claims received from the various parties upto 8th December 2021. The list of claims given below 1 2 S.No. Name of Form Creditor State Bank of Form C India TATA Capital Form C Financial Amount Claimed (In Rs.) 250,90,45,531 23,20,01,043 Services Limited 3 Employee's Form F (But 75,836 State Form B Insurance submitted) Corporation Total 250,91,21,367 Document 8 porty La abad Bench 18. We have peru....