9911796707
TMI Blog2017 (1) TMI 1058X X X X Extracts X X X X X X X X Extracts X X X X ..... on 18.03.2010. 2.3. In view of the aforesaid averments, made in the petition, I would have thought that the petitioner would have been described in the Company Petition, more appropriately, via its new name. This, evidently, has not been done. The petition has been filed, as it appears under its earlier name. 2.4. Notwithstanding the above, on merits, the case set up by the petitioner, is that, being in the business of International Factoring, it entered into Trade Finance Facility Agreement with the respondent on 23.09.2006, upon issuance of a sanction letter of even date, i.e., 23.09.2006. 2.5. Under this agreement, the petitioner sanctioned a funding limit upto a maximum of Rs. 2,85,00,000/- (Rupees two crores and eighty five lakhs only) in favour of the respondent. 2.6. The said facility was secured by execution of the following documents : i. Letter of undertaking dated 11.11.2006 ii. Letter of confirmation dated 11.11.2006, by which, the respondent confirmed that in the event, it avails of any preshipment finance in respect of any receivables assigned to the petitioner, it will advise the petitioner as to the details of such facility, and that, all payments made in res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ores and twenty lakhs only). The Approved Debtor increased in number from one to two. Thus, apart from BCPMS, an entity by the name of Al-Riffa Jewellery LLC was included. The Debtors Credit Limit and the Debtors Credit Protected Limit was set forth as follows : Debtor Name Debtor Limit Currency Debtors Credit Limit Debtors Credit Protected Limit BCPMS USD 590,278 425,000 Al-Riffa Jewellery LLC INR 64,705,882 44,000,000 4.4. Like in 2006, the relevant documents and undertakings were executed. 4.5. On 26.06.2007, the sanction letter of 16.04.2007 was amended. This was, in effect, the third amendment. However, Approved Debtors remained the same, i.e., BCPMS and Al-Riffa Jewellery LLC. Furthermore, the Debtors Credit Limit and Debtors Credit Protected Limit also remained unchanged. 4.6 Consequent thereto, a series of security documents and undertakings, including GARMA, were executed between the parties herein, all of which, were dated 16.07.2007. 4.7. The record shows that several realignments of the Trade Finance Facility took place between December, 2007 and October, 2008, with the execution of sanction letters dated: 12.12.2007; 01.01.2008; 18.01.2008; 16. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lauses of GARMA to contend that, since, the Approved Debtor had become insolvent, the petitioner could not take recourse to it or, its Guarantor/Directors for recovery of the amounts referred to in its demand notice. 6.1. It was also averred that as the receivables aggregated, to a sum of Rs. 3,22,07,350/-( which was within the credit protection limit of Rs. 5,00,00,000/-, available to the Approved Debtor, ie., BCPMS), the petitioner could have no recourse to the respondent or its Guarantors. 6.2. The thrust of the reply was that the factoring facility offered by the petitioner was different from the conventional Billdiscounting facility offered by the local commercial banks, in as much as, it came with an added feature, which was, that it could have no recourse to the respondent in case the Approved Debtor became insolvent. 6.3. The respondent's Advocate also adverted to the fact that the Guarantor Directors' had, as a matter of fact, instituted a Civil Suit, which was numbered as: O.S.No.126 of 2009, in the Court of Additional District Judge, Coimbatore, in respect of matters raised in the petitioner's legal notice. The fact that the Directors/Guarantors of the res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the receivables, the petitioner, was entitled to take recourse to the respondent for recovery of amounts paid to the respondent under the Trade Finance Facility Agreement. 13. On the other hand, learned counsel for the respondent contended that the petition under Section 433 of the 1956 Act was not maintainable, as this was not a case of an admitted liability, which, the respondent had failed to liquidate. 13.1. Mr. Vidhya Shankar, relied upon Clause 9.1 of GARMA to contend that in a situation, where the Approved Debtor became insolvent, the petitioner could not take recourse to the respondent qua the liability of BCPMS. Learned counsel further submitted that, since, the amount outstanding, vis-a-vis, the Approved Debtor, ie., BCPMS, was within the Debtors Protection Limit, the entire burden had to be borne by the petitioner. 13.2. Learned counsel, also, relied upon the counter affidavit to draw my attention to the averments made therein which pointed in the direction that not only had the petitioner approached the Administrators of BCPMS, but had also, taken secured itself against risks, vis-a-vis, amounts paid under the Trade Finance Facility Agreement, by taking out an insura ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e aforesaid facts would show that the agreement between the parties herein was that the petitioner would purchase the bills, and hence, have the title to the documents transferred, based on which, exports were made by the respondent to the Approved Debtor, for a consideration. The receivables against the exports made by the respondent would directly come to the fold of the petitioner. The only exception carved out to this arrangement was, the Approved Debtor's insolvency. Clause 9.1. of GARMA, quite clearly, exemplifies this position. 15.1. For the sake convenience, the said clause is extracted, herein below: "9. RECOURSE AND CREDIT PROTECTION 9.1. GTF shall have Recourse in respect of : 9.1.1 each Receivable which the Debtor shall be, or shall claim to be, unable to pay by reason of legal constraints (other than those created by the Debtor's insolvency) or acts or orders of Government (unless otherwise specified in paragraph 9 of the Schedule); 9.1.2. each Receivable in respect of which the Debtor shall dispute liability for payment whether in whole or in part; 9.1.3 each Receivable in respect of which the Debtor shall assert any right of lien, retention, counter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the Approved Debtor, except those which were created by Debtor's Insolvency. Admittedly, the Approved Debtor i.e., BCPMS had become insolvent and the knowledge with respect to the same was available with the petitioner. This fact is laid bare on perusal of letter dated 30.01.2009, issued by KPMG, the Administrators of BCPMS. 16.1. Furthermore, if there was any doubt with regard to aforesaid it is set to rest upon a perusal of the petitioner's own letter dated 25.08.2009, wherein, it makes a reference to the Administrators of BCPMS. The said letter is a clear pointer to the fact that the petitioner was in touch with the Administrators of BCPMS and, it had, dispatched the said communication, when, the Administrators informed the petitioner that no outstandings were owed by BCPMS to the petitioner. 16.2. It is, in this context, that the petitioner, by very same letter, indicated to the respondent that, since, it had not protected its title qua the receivables, it was seeking from the respondent the payment of the amounts involved. In support of its stand, the petitioner alluded to Clauses 7 and 9 of GARMA in the said communication. 16.3 Importantly to lend clarity to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
