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TMI Blog2017 (11) TMI 1339X X X X Extracts X X X X X X X X Extracts X X X X ..... ution Process against the Corporate Debtor on grounds of non-payment of his debt. 2. Brief facts of the case are that a sum of Rs. 1,81,00,000/- was given as a loan by the Financial Creditor to the Corporate Debtor. It is averred that as per their mutual understanding, the said loan was to be repaid on demand with interest @18% per annum. The Financial Creditor was also appointed as a Director in the Respondent company on 19.12.2012 and according to him, he remained in the Board till 2015. The Financial Creditor is also a shareholder and holds. 07% equity in the Respondent company. The grievance of the Financial Creditor is that despite seeking return of his loan, on demand, along with interest @ 18% per annum, no payment has been made fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d various amounts as the Margin Money to enable them to get the loan facility from Canara Bank. 5. The contention that the Financial Creditor has been removed as a Director of Respondent company is repudiated. According to the Respondent he continues to be on the Board of Directors from the date of his appointment i.e. 19.12.2012 till date. The paid-up capital of the Respondent company is Rs. 7,22,00,000/- divided into 72,20,000 equity shares of Rs. 10 each. The Financial Creditor holds 5,000 shares. All six shareholders have contributed to a total of Rs. 16,42,00,000/- in the form of equity and unsecured loans. The Corporate Debtor, with an intention of setting up a project for the manufacture of Flexible Packaging Material under Co-exten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terms and conditions:- i. That the unsecured creditors had extended or continued to extend interest free unsecured loan on the express understanding that all their claims against the Respondent Company would be subject to the claims of Canara Bank. ii. That all the claims of the unsecured creditors against the Respondent Company would at all times be subordinate and be subject to any claims of Canara Bank. iii. The unsecured creditors agree not to sue the Respondent Company for recovering any money tendered to the Respondent Company as unsecured loan until all the claims of Canara Bank get settled. iv. That the unsecured creditors agree not to join in any bankruptcy or any assignment. The Respondents have annexed the Subordination ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lvency proceedings, it is his wish and desire that the Resolution Process be initiated and the entire project be dumped before it comes into operation, irrespective of whether he can realise any proceeds or not in the watershed for repayment should the assets of the Corporate Debtor be liquidated. It is being noted that Canara Bank is not an aggrieved party. 10. The said attitude of the Financial Creditor is irreprehensible as the principal money lender i.e. Canara Bank has not made any claim. Insolvency Resolution Process of a corporate entity cannot be initiated on such grounds which reek of personal vendetta. The Financial Creditor seeks to scuttle the project even before it get into operation. Such arm twisting tactics cannot be the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X
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