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2026 (5) TMI 135
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....ed by the Adjudicating Authority (National Company Law Tribunal) Principal Bench, New Delhi admitting Section 7 application filed by the Bank of India. Aggrieved by the order, this Appeal was filed on the next date i.e. 13.01.2026. On 14.01.2026, Appeal was heard by this Tribunal and hearing was completed and orders reserved. This Tribunal directed IRP not to take any further steps till the delivery of the order. 2. Brief facts of the case necessary to be noticed for deciding the Appeal are:- 2.1. The Bank of India sanctioned financial facilities in the year 2010. A term loan of Rs. 100 Cr. to the Corporate Debtor for part-financing the construction of a Five Star Hotel at Plot No.1, CBD, Shahdara, Delhi. Rs. 95 Crores were disbursed. Additional amount of Rs. 38 Crore was sanctioned. The loan facility was part of a consortium banking arrangement. Jammu & Kashmir Bank being lead Bank. On there being default on the part of the Corporate Debtor, Banks in consortium implemented a Strategic Debt Restructuring (SDR) plan. To execute the SDR, the lenders agreed to convert their loan into equity. The Financial Creditor declared the account of Corporate Debtor as NPA on 31.03.2018. A ....
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....A No.21 of 2026 and adjourned the matter for consideration on 02.02.2026. On 09.01.2026, cause list for 12.01.2026 was released fixing the matter for pronouncement of the order in Section 7 petition. Corporate Debtor's counsel on 12.01.2026 at 8:27 AM sent an e-mail to the Registrar informing that in IA No.21 of 2026 Corporate Debtor has sought leave of the Tribunal to deposit the entire amount as claimed by the Financial Creditor in petition by way of demand draft which application is pending consideration and matter has been fixed for further consideration on 02.02.2026. Counsel intimated that it appears that there is some error in the cause list and the message be placed before the Hon'ble Bench. 2.3. On 12.01.2026, the Adjudicating Authority pronounced the order in Section 7 petition admitting Section 7 application and appointing Respondent No.2 as IRP. The present Appeal was presented in this Tribunal on 13.01.2026, the very next date and matter was heard on 14.01.2026 and on 14.01.2026, following order was passed:- "14.01.2026: Heard Ld. Counsel for the Appellant as well as Ld. Counsel for the Bank of India. Ld. Counsel for the IRP is also present. We have heard t....
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....s having issued by the Adjudicating Authority on 07.01.2026 fixing next date as 02.02.2026, there was no occasion to admit Section 7 application. Further, IA No.5853 of 2025 which was filed by the Corporate Debtor praying for rejection of Section 7 application was directed to be listed on 10.01.2026 which application still remain pending without deciding IA No.5853 of 2025. Section 7 application could not be admitted. It is submitted that the deposit by Corporate Debtor is without prejudice to submission of the Appellant that there is no default and no grounds have been made out to admit Section 7 application. However, Appellant in the present Appeal is praying for closing the CIRP proceeding initiated against the Appellant on account of deposit made of the entire amount. It is submitted by Counsel for the Appellant that the amount as claimed by Financial Creditor in Section 7 application is not correct amount due on the Corporate Debtor and determination of the correct amount due in Corporate Debtor is necessary and from the deposit made by the Corporate Debtor Bank can utilise the said amount. Counsel for the Appellant further submits that the Appellant is ready to prepare a fres....
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.... in C.P (IB) No.213/ND/2025 have been completed and on 12.01.2026, relying on the order passed in Section 7 application filed by the Bank of India, Section 7 application filed by Punjab & Sind Bank has also been disposed of. It is submitted that any offer of settlement by the Corporate Debtor in favour of Bank of India can only be considered following due procedure under Section 12A of the IBC. He has placed reliance on the judgment of the Hon'ble Supreme Court in "Glas Trust Company LLC vs Byju Raveendran & Ors.- (2025) 3 SCC 625". 7. Dr. Singhvi, Learned Senior Counsel making his submission in rejoinder submits that the entire amount having been deposited in the Court by payment order annexed to the IA No.21 of 2026, the Adjudicating Authority could not have admitted Section 7 application. It is submitted by Appellant that there were eight banks in consortium, with four banks have already issued NoC in favour of the Corporate Debtor with respect to Punjab & Sind Bank, the entire amount of Rs. 54,47,74,019/- upto 25.11.2025 has been deposited with DRAT. With respect to Jammu & Kashmir Bank, matter is pending in the High Court and for Bank of India already a demand draft of Rs. ....
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.... as the Corporate Debtor has failed to repay the outstanding debt despite repeated demands. Date on which the account was classified as NPA due to persistent defaults: 31.03.2018 (w.e.f 18.07.2017) Moreover, the default is continuing as the Corporate Debtor has failed to pay the above mentioned outstanding debt. That the CD has acknowledged its debt and default and had submitted various OTS proposals inter alia on: (i) The debt acknowledgment letter executed by the Corporate Debtor, the last of which is dated 01.06.2017, explicitly admitting the outstanding liability. (ii) OTS Proposal dated 03.09.2018 (iii) OTS Proposal dated 28.08.2019 (iv) OTS Proposal dated 08.01.2021 and withdrawal notice dated 08.03.2021 (v) OTS Proposal dated 24.02.2023 (vi) OTS Proposals dated 04.11.2023, 01.01.2024 and 15.01.2024 (vii) Letter of Request dated 24.03.2025 for Refund of Rs. 7 Crores Deposited Towards Proposed OTS demonstrating the failure of OTS. The financial statements of the Corporate Debtor, wherein the outstanding loan liability has been reflected in the balance sheets for the subsequent financial years for 2020-2021, 20201-2022 and 2022-2023. 10. There....
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....the merits of the case for determination of the actual legitimate debt owed to bank; C. To pass such other or further order(s) as this Hon'ble Tribunal may deem fit in facts and circumstances of the present case." 12. Along with the application, payment order dated 24.12.2025 in the name of Registrar, NCLT for Rs. 119,00,94,658.68/- was also annexed. In paragraph 1 of the application, following has been pleaded:- "1. The present Application is being filed by Corporate Debtor / Applicant, on a without prejudice, to seek leave of this Hon'ble Tribunal to deposit an amount of INR 119,00,94,695.68/- (Rupees One Hundred Nineteen Crore Ninety Four Thousand Six Hundred Ninety Five and Sixty Eight Paisa Only) with the Registrar, National Company Law Tribunal, New Delhi to demonstrate the solvency of the Corporate Debtor and its capacity for repayment of the legitimate debt to the Financial Creditor. Further, the Corporate Debtor seeks that this Hon'ble Tribunal recall its Order dated 10.12.2025 and afford an opportunity to the Corporate Debtor to make submissions on the merits of the case for determination of the actual legitimate debt in order for the Corp....
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.... "Subject: Bank of India v. Aman Hospitality Private Limited-CP (IB) 276 ND/2025-Urgent Request-12.01.2026 Date: Monday, 12 January 2026 at 8:27:23 AM India Standard Time From: [email protected] To: [email protected] CC: [email protected], Office of VAR Attachments: Copy of Demand Draft for INR 119 Crores-NCLT Registrar-24.12.2025.pdf, image001.png Respected Sir(s), We write in reference to the captioned matter listed for Pronouncement of Orders at Item 201, before the Hon'ble Principal Bench, New Delhi today. We request you to kindly take note that an Interim Application (I.A. 21/PB/2026) seeking the leave of the Hon'ble Tribunal to deposit the entire amount, as claimed by the FC in the Petition, by way of demand draft in the amount of INR 119 Crores in favour of the Registrar, NCLT (copy attached) is pending for consideration. The Hon'ble Bench has issued Notice to the Bank on 07.01.2026, to file the reply to the same within a weeks' time, and listed the matter for further consideration on 02.02.2026. So there appears to be some error in cause list, as the case should b....
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....ence at the time of filing of reply and at the time of making pleadings in the main company petition. Neither do we find any cogent grounds having been cited to explain what had impeded the Appellant from flagging these issues during the hearing of the main company petition. It also does not stand to any logical reasoning as to why the issues raised in the I.A. could not have been raised in the main company petition. Raising such technical issues and that too after detailed hearing in the main petition was concluded clearly shows that the Appellant was merely trying to raise feeble grounds in the L.A. to somehow delay and derail the admission of CIRP. Hence in our considered opinion, the Adjudicating Authority had rightly rejected the I.A. 253/2023." 16. In the case of "Loramitra Rath" (supra), an appeal was filed challenging the two orders of the Adjudicating Authority where IA No.253 of 2023 was rejected by the Corporate Debtor and application under Section 7 filed by JM Financial Asset Reconstruction Company Ltd. was admitted by another order. The above IA No.253 of 2023 was filed for recall of the order reserving the matter and praying for rehearing of the matter. The matter....
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....debt and default on the part of the Corporate Debtor, Adjudicating Authority has to admit Section 7 application. The object of the Insolvency and Bankruptcy Code, 2016 is resolution for corporate person in a time bound manner. In the present case, when Corporate Debtor, after hearing was completed and matter was reserved, by an application sought leave of the Adjudicating Authority to deposit the entire defaulted amount as claimed by Financial Creditor by payment order in the name of the Registrar, NCLT in which application, notices were issued by the Adjudicating Authority on 07.01.2026 fixing the matter for 02.02.2026, the Adjudicating Authority committed error in admitting Section 7 application by order dated 12.01.2026. The fact that application IA No.21 of 2026 was entertained by issuing notice by the Adjudicating Authority is fully proved. In fact, issuance of notice also supports the submission of the Appellant that the prayer made in the application to seek liberty of the Adjudicating Authority to deposit the entire amount was treated to be relevant worth consideration. 19. The present is a case where Corporate Debtor has come up with prayer although subsequent to reserv....
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.... of the financial creditor." 20. It is useful to notice paragraphs 6, 7 and 8 of the judgment of this Tribunal in "Reliance Commercial Finance Ltd." (supra)- "6. In the present case, section 7 application was filed claiming an amount of Rs. 15,79,41,658. On the earlier date, when the company petition was taken, i.e., on July 6, 2022, the corporate debtor came with an offer of Rs. 12.75 crores to be paid within 45 days on which, the court directed the financial creditor to obtain instructions. Amount of Rs. 12.75 crores which was offered on July 6, 2022 by the corporate debtor was not the entire amount claimed by the financial creditor in the application. But on the next date i.e., July 11, 2022, when the case was taken, learned counsel for the corporate debtor submitted that the corporate debtor is now ready to deposit the entire amount within 45 days. The Adjudicating Authority noticed the submission of learned counsel for the financial creditor which was to the following effect: "Mr. Ayush J. Rajani, counsel appearing for the financial creditor submitted that the financial creditor is not willing to settle the matter as they have no confidence on the corporat....
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.... to the Financial Creditor but offer of deposit with a prayer to determine the actual estimate debt which determination cannot be subject matter of Section 7 proceeding. It is submitted that the present is not a case where Corporate Debtor unconditionally has submitted the payment order of Rs. 119,00,94,695.68/-. In paragraph 14 of the application IA 21 of 2026, following has been pleaded:- "14. In the alternative, and without prejudice to the above, should this Hon'ble Tribunal is of the view that the said exercise of determination of quantum of debt ought to be performed by the appropriate court / tribunal having jurisdiction to do so, then liberty may be granted to the CD to approach the Debts Recovery Tribunal - II, New Delhi (ORT), where the FC's recovery proceedings in Bank of India v. Aman Hospitality Private Limited & Ors (O.A. 258 of 2021) is pending adjudication, for the purposes of determination and quantification of debt. The amounts deposited with this Hon'ble Tribunal herein may be kept in an interest-bearing fixed deposit for the benefit of the FC, with a direction to the FC to appropriate the said sum once the quantum is fixed by the DRT, and th....
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....of 2025 admitting the Corporate Debtor to CIRP Process. It is further submitted that any settlement by Corporate Debtor with the Bank of India can be permitted only as per procedure prescribed under Section 12A reliance has been placed on judgment of the Hon'ble Supreme Court in "Glas Trust Company LLC vs Byju Raveendran & Ors.- 2025 3 SCC 625". The present is a case where we have held that the order dated 12.01.2026 admitting Section 7 application is not sustainable. In view of the application IA No.21 of 2026 filed by the Corporate Debtor subsequent to reserving the order and the Adjudicating Authority having itself in the order notice on the application on 07.01.2026 fixing the matter for 02.02.2026. The present is not a case where any settlement between the parties is being recorded by the Court. The Corporate Debtor of its own has already filed an application before the Adjudicating Authority seeking leave to deposit the entire amount by payment order in the name of Registrar NCLT which application remains pending and Section 7 application was admitted. The present is not a case of any settlement entered between the Bank and the Corporate Debtor rather Corporate Debtor has vol....