TaxTMI 
TaxTMI 
2023 (8) TMI 1376
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....om the Financial Creditor between 2004 and 2016. On account of default committed by the Corporate Debtor, the Account was classified as NPA on 19th July, 2016. On 15th December, 2016, recall notice was issued for outstanding amount of Rs. 8,65,76,698/-. Notice under Section 13(2) of SARFAESI Act, 2002 was issued on 28th February, 2017. ii. An OTS proposal was submitted by the Corporate Debtor vide Letter dated 04.12.2019. OTS proposal submitted by the Corporate Debtor was sanctioned by the Bank vide Letter dated 14.02.2020 for outstanding dues of Rs. 12,80,11,496/-. Bank agreed to settle the outstanding dues at Rs. 5 Crores. Corporate Debtor on 13th March, 2020 sought for modification of repayment schedule. Corporate Debtor subsequently vide its letter dated 25th January, 2021 withdrew its OTS Proposal. iii. Section 7 Application was filed by the Financial Creditor for outstanding amount of Rs. 15,55,87,365/-. A reply was filed by the Corporate Debtor raising various defences. The Adjudicating Authority by the Impugned Order held that date of default as per Information Utility is 26.09.2019. The Adjudicating Authority held that Corporate Debtor has acknowledged th....
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....default occurring during the said period. Explanation. - For the removal of doubts, it is hereby clarified that the provisions of this section shall not apply to any default committed under the said sections before 25th March, 2020." 7. The law of Section 10A is well settled. The Hon'ble Supreme Court in Civil Appeal No. 4050 of 2020, "Ramesh Kymal Vs. M/s. Siemens Gamesa Renewable Power Pvt. Ltd." laid down following in Paragraphs 22,23 and 24: "22 The language of the provision is not always decisive to arrive at a determination whether the provision if applicable prospectively or retrospectively. Justice G.P. Singh in his authoritative commentary on the interpretation of statutes, Principles of Statutory Interpretation, has stated that: "In deciding the question of applicability of a particular statute to past events, the language used is no doubt the most important factor to be taken into account; but it cannot be stated as an inflexible rule that use of present tense or present perfect tense is decisive of the matter that the statute does not draw upon past events for its operation. Thus, the words "a debtor commits an act of bankruptcy" were held ....
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....very purpose and object underlying the insertion of Section 10A. For, it would leave a whole class of corporate debtors where the default has occurred on or after 25 March 2020 outside the pale of protection because the application was filed before 5 June 2020. 24 We have already clarified that the correct interpretation of Section 10A cannot be merely based on the language of the provision; rather it must take into account the object of the Ordinance and the extraordinary circumstances in which it was promulgated. It must be noted, however, that the retrospective bar on the filing of applications for the commencement of CIRP during the stipulated period does not extinguish the debt owed by the corporate debtor or the right of creditors to recover it." 8. In Ramesh Kymal's Case, the Appellant had filed an Application under Section 9 on 11th May, 2020 on the ground of default. The ordinance No. 09/2020 was promulgated by the President of India on 05th June, 2020 by which Section 10A was inserted into the I&B Code, 2016. An Application was filed by the Corporate Debtor for dismissal of Section 9 Application, the Section 9 Application was dismissed on the ground of Section....
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.... Thus, the present is the case where default was committed prior to commencement of Section 10A period. 11. The submission which has been pressed by the Learned Counsel for the Appellant is that since consequent to approval of the OTS on 14th February, 2020, the Corporate Debtor committed another default during the Section 10A period, it is entitled to benefit of Section 10A period. The OTS dated 14.02.2020 has been brought on record at page 592. Paragraph 2 of the Order of the Bank dated 14.02.2020 is as follows: "2. Bank agrees to settle the aforesaid outstanding dues at Rs. 5,00,00,000/- (Rupees Five Crore) subject to satisfactory payment in accordance with the terms and conditions as follows; a. Upfront payment of Rs. 0.25 crore. b. Rs. 0.25 crore within one week of this letter. c. Rs. 0.50 crore on or before 29.02.2020. d. Remaining amount in 6 monthly instalments of Rs. 0.50 crore each starting from March 2020 and last instalment of Rs. 1 crore on or before 30.09.2020 plus interest @12% from 01.04.2020 on unpaid settlement amount on reducing balance basis." 12. Immediately after OTS Approval, Corporate Debtor on 13th March, 2....
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.... 2020. It's a fact that there is a near force majeure situation in the Poultry Industry due to a sudden demand and price shrinkage, in light of the misinformation and unwarranted knee jerk reactions to the COvid-19 outbreak. KHL is a victim of such extremely adverse market sentiments and actions and we are incurring unprecedented losses on a daily basis. b. in light of this sudden negative business situation, our cash flows as a group are not what we had estimated around two months back when we had discussed the proposed OTS with your Bank. The sudden outbreak of Corona fear was not understood properly. We therefore request your consideration of the OTS scheme with a timeline that we can adhere to and honour. c. We propose the following OTS pay outs schedule: S. No. Timeline Amount (Rs. Lacs) 1 Before 31st March 2020 50.00 2 30th April 2020 10.00 3 31st May 2020 10.00 4 30th June 2020 40.00 5 31st July 2020 40.00 6 31st Aug 2020 50.00 7 30th Sept 2020 50.00 8 31st Oct 2020 50.00 9 30th Nov 2020 100.00 10 31st Dec 2020 100.00 Total 500.00 Note....