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TMI Blog2018 (8) TMI 138X X X X Extracts X X X X X X X X Extracts X X X X ..... n, Counsel ORDER Per- CH MOHD SHARIEF TARIQ, MEMBER (J) 1. Under adjudication is an Application that has been filed by M/s. Baobab Broadband Limited (hereinafter referred to as Financial Creditor ) under Section 7 of the Insolvency and Bankruptcy Code, 2016 r/w Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 against M/s. Gemini Communication Limited (hereinafter referred to as Corporate Debtor/Guarantor ). The prayer made is to admit the Application, to initiate the Corporate Insolvency Resolution Process against the Corporate Debtor, declare moratorium and appoint Interim Resolution Professional (IRP) under the Insolvency and Bankruptcy Code, 2016 (I B Code). 2. Heard the Counsels for the Financial Creditor, and the Corporate Debtor, and perused the pleading including the Written Submissions and typed set of documents filed by the Financial Creditor and Corporate Debtor. 3. The Financial Creditor has claimed an amount to the tune of USD 15,60,000/- which was disbursed during June, 2010 to 26th of March, 2013. Now, the amount claimed to be in default as on date is USD 19,57,441/-, which the Corporate Debtor f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fotek in favour of Baobab and/or to be created pursuant to the Loan Agreement in connection with the repayment of amounts until all amounts claimed by Baobab from the Guarantor has been fully paid. 16 .. 17 18. The guarantee hereby given is independent and distinct from any security that Baobab has taken or may take in any manner whatsoever whether it be by way of hypothecation, pledge and/or mortgage and/or any other charge over goods, movables or other assets and/or any other property movable or immovable and that the Guarantor has not given this guarantee upon any understanding faith or belief that Baobab has taken and/or may hereafter take any of other such security and that notwithstanding the provisions of Sections 140 and 141 of the Indian Contract Act, 1872 or other section of that Act or any other law, the Guarantor will not claim to be discharged to any extent because of Baobab s failure to take any or other such security or in requiring or obtaining any or other such security or losing for any reason whatsoever including reasons attributable to its default and negligence, benefit of any or other such security or any of rights any or othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Financial Creditor and unless the transfer occurs, the guarantee cannot be invoked. Thus, as per the submissions of the Corporate Debtor, there is neither a debt due nor a default. The Corporate Debtor/ Guarantor has further submitted in the reply Affidavit that the mandatory record from Information Utility has not been furnished and the Deed of Guarantee dated 12.06.2010 on the basis of which the Financial Creditor is claiming monies, is a nullity in the eyes of law, as no sanction/ approval of RBI has been taken and the jurisdiction of the Adjudicating Authority is barred by limitation. Based on the above submissions, the Corporate Debtor/ Guarantor has prayed to dismiss the Application. 9. The Corporate Debtor/ Guarantor in support of its arguments has cited the following judgments along with their ratio decidendi: 1. Kalra Iron Stores v. Faridabad Fabricators (P.) Ltd. 1991 SCC Online Del 338. * Proof of debt is required to be filed to prove that the company is unable to pay the debts under the requirement of section 433(e) through the records, accounts or Acknowledgments. *. Tata Iron Steel Co. Ltd. v. Omega Cables Ltd. [2008] 142 Comp. Cas. 468 (Mad.). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch the Corporate Guarantee in question is not enforceable is stated to be wholly vague and baseless because as per Article 3 of the Loan Agreement, the Corporate Debtor/Guarantor assured the Financial Creditor of its ability to provide such Guarantee in accordance with the applicable law and regulations. Therefore, the Corporate Debtor/ Guarantor cannot hide itself behind its own failure to obtain any required approval to wriggle out of its liability or consequences of default. 13. It has further been stated that the failure on the part of the Corporate Debtor/Guarantor to obtain such approval, does not impinge upon the validity of the Guarantee issued. The Financial Creditor has relied upon the judgment of Hon ble High Court of Delhi given in SRM Exploration (P.) Ltd. v. N S N Consultants SRO 2002 (129) DRJ 113 (DB). The Financial Creditor has also controverted the objection with regard to the period of limitation by relying upon the rulings given by Hon ble NCLAT in Neelkant Township Construction (P.) Ltd. v. Urban Infrastructure Trustee Ltd. [CA (AT) No. 44 of 2017], wherein the Hon ble NCLAT has held that I B Code 2016 does not suggest that the Limitation is applicab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002); (d) The recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. 18. The supply of essential goods or services of the Corporate Debtor/ Guarantor shall not be terminated or suspended or interrupted during moratorium period. The provisions of sub-section (1) of section 14 shall not apply to such transactions, as notified by the Central Government. 19. The IRP shall comply with the provisions of sections 13(2), 15, 17 18 of the I B Code. The Directors of the Corporate Debtor, its promoters or any person associated with the Management of the Corporate Debtor are/is directed to extend all assistance and cooperation to the IRP as stipulated under section 19, so that she could discharge his functions under section 20 of the I B Code, 2016. 20. The Financial Creditor and the Registry are directed to send the copy of this Order to IRP, so that she could take charge of the Corporate Debtor s assets etc., and make compliance with this Order as per ..... X X X X Extracts X X X X X X X X Extracts X X X X
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