2017 (11) TMI 2058 - Tri - Insolvency and Bankruptcy

Maintainability of application - initiation of CIRP - Existence and amount of financial debt and default - HELD THAT - As per Part-V of the application the total estimated value of the security held by all the lenders of the Company as per estimate made by AARC is Rs. 271.85 Crores. Copies of Certificates of Registration of Mortgage and of Modification of Mortgages issued by Registrar of Companies, New Delhi have also been enclosed with the Application as Annexure 5 - The financial creditor Applicant has also placed the copies of the financial contracts with respect to the facilities given by the consortium lenders including State Bank of Hyderabad (now merged with State Bank of India), now held by AARC are as Annexure 6 to 54 with the Application as Proof of Existence of Debt. The 'financial creditor' has placed on record an overwhelming amount of evidence to prove the amount advanced to the Corporate Debtor. Petition admitted.

Summary

Issues Involved:
1. Triggering Corporate Insolvency Resolution Process (CIRP) u/s 7 of the Insolvency and Bankruptcy Code, 2016.
2. Existence and amount of financial debt and default.
3. Appointment of Interim Resolution Professional (IRP).
4. Declaration of moratorium u/s 14 of the Code.

Summary:

1. Triggering Corporate Insolvency Resolution Process (CIRP) u/s 7 of the Insolvency and Bankruptcy Code, 2016:
The Financial Creditor, Alchemist Asset Reconstruction Co. Ltd (AARC), filed an application u/s 7 of the Insolvency and Bankruptcy Code, 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against Moser Baer India Ltd. (MBIL). AARC acquired the secured debt from State Bank of Hyderabad (now merged with State Bank of India) via an assignment deed dated 30.03.2016.

2. Existence and amount of financial debt and default:
The Financial Creditor provided detailed particulars of the financial debt, including dates of disbursement and amounts. The total debt disbursed was Rs. 100 Crores, later restructured to Rs. 119.47 Crores. The Corporate Debtor defaulted, and the debt amount outstanding as of 10.09.2017 was Rs. 1,85,37,13,958/-. The account became NPA on 26.11.2014, and a recall notice was issued on 04.04.2017. The Financial Creditor provided extensive evidence, including entries in Banker's Books and other documents, to prove the debt and default.

3. Appointment of Interim Resolution Professional (IRP):
The Financial Creditor proposed Devendra Singh as the Interim Resolution Professional (IRP). He provided a consent letter and declaration stating no disciplinary proceedings were pending against him, and he was eligible to be appointed as IRP. The Tribunal appointed Devendra Singh as the IRP.

4. Declaration of moratorium u/s 14 of the Code:
The Tribunal declared a moratorium u/s 14 of the Code, prohibiting:
- Institution or continuation of suits or proceedings against the Corporate Debtor.
- Transfer, encumbrance, or disposal of the Corporate Debtor's assets.
- Foreclosure, recovery, or enforcement of any security interest.
- Recovery of any property by an owner or lessor.

The moratorium does not apply to transactions notified by the Central Government or the supply of essential goods or services to the Corporate Debtor.

Conclusion:
The petition was admitted, and the IRP was directed to make a public announcement and perform his duties as per the Code. The personnel connected with the Corporate Debtor were instructed to cooperate with the IRP. The office was directed to communicate the order to the Financial Creditor and the Corporate Debtor within seven days.