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TMI Blog2018 (9) TMI 1394X X X X Extracts X X X X X X X X Extracts X X X X ..... ion to trigger Corporate Insolvency Resolution Process under the Code is maintainable. The applicant bank has also filed the relevant statement of accounts duly certified in accordance with Banker Books Evidence Act, 1891 as per the requirement of Form 1 part V column 7 of the application. The detailed outflow and disbursements made from the accounts pertaining to respective loan facilities are reflected in the relevant bank statements. Certified copy of statement of account kept during the course of banking business basing on which the claim has been raised can be termed as sufficient evidence of financial debt. As seen from the statement of account and loan documents that the loan was sanctioned, loan agreements were executed and charge and securities were created to secure the loan. Respondent company utilised and enjoyed the loan facility and due to non-payment and non-refund of the outstanding dues, the account of the corporate debtor was declared NPA. The applicant bank has also placed CRILC report in order to show that accounts of corporate debtor was reported as loss and doubtful account. The applicant ‘financial creditor’ has placed on record voluminous and overwhelming ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicant has relied upon the authority letter dated 30.01.2018 of the applicant bank wherein she was authorised to submit application for and on behalf of IDBI Bank Limited to initiate corporate insolvency resolution process against ACIL Limited in terms of the provisions of the Code. A copy of the Authorisation Letter dated 30th January, 2018 has been placed on record. The authority letter is clearly an order of authorisation enabling Smt. Shivani Singla, General Manager of the applicant bank to sign and file the present application under Section 7 of the Code for initiation of corporate insolvency resolution process against respondent ACIL Limited in terms of the provisions of the Code. 5. The applicant initially had proposed the name of Shri Pradeep Kumar Sethi, for appointment as interim resolution professional. However due to an objection raised by the corporate debtor the applicant was directed vide order dated 04.06.2018 to rectify the petition and change the name of proposed IRP. Thereafter, the applicant vide affidavit dated 12.07.2018 has proposed name of Mr. Ravindra Loonkar, having registration number IBBI/IPA-002/IP-N00433/2017-2018/11206, having office at RBSA ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under the Multiple Banking Arrangement and working Capital Consortium the respondent was still facing liquidity constraints and was unable to fulfil its commitment towards repayment of loans to the petitioner. Thereafter a Joint Lenders Forum ("JLF Lenders") was constituted with the Petitioner designated as the Lead Bank. The JLF Lenders decided to follow the rectification approach and agreed that additional facilities would be considered for sanction as part of Corrective Action Plan (CAP) based on the outcome of the Techno Economic Viability Study. 9. Subsequently, the Respondent requested for fresh/renewal of credit facilities to finance its critical capital expenditure required under the CAP and for shoring up its Net Working Capital ("NWC"). The Lenders agreed to provide fresh corporate loans ("JLF Corporate Loans") and further to continue/renew the Existing Term Loans and Existing Working Capital ("JLF Term Loan"). 10. In view of the concurrence by the Lenders, the Petitioner was designated as the Lead Bank and along with Bank of Maharashtra, Andhra Bank, State Bank of Mysore and the Karur Vysya Bank Limited (JLF Lenders) executed the Framework Agreement for Corrective Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Respondent company formerly known as Amtek Crankshafts (India) Limited. b. Letter of Comfort issued by Amtek Auto Limited dated 28.03.2012. c. Promissory Note dated 22.03.2016 executed by ACIL Limited in terms of repayment of Term Loan of ₹ 117 crores. d. Undertaking to create mortgage/charge dated 29.03.2012 executed by ACIL Limited for creating first charge on its movable and immovable fixed assets of the company. e. Memorandum of Entry dated 13.10.2014 for immovable properties bearing Plot No. 53, measuring 7875 square meters of Land covered area of 5294.05 square meters (approx.) situated in Sector-3, IMT Manesar, Distt. Gurgaon, Haryana (Industrial Property). f. Declaration and Undertaking dated 21.10.2014 executed by Vinod Kumar Uppal in favour of Canara Bank for creating first charge and mortgage for IDBI Bank RTL of ₹ 254 crore on its immovable properties bearing Plot No. 54, measuring 7875 square meters of Land covered area of 5294.05 square meters (approx) situated in Sector-3, IMT Manesar, Distt. Gurgaon, Haryana (Industrial Property). g. Undertaking to create mortgage charge dated 22.03.2016 by the respondent. h. Joint Deed of Hypotheca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble mortgage in order to secure the debt. Respondent company utilised and enjoyed the loan facility and due to non-payment and non-refund of the outstanding dues, the account of the corporate debtor was declared NPA on 15.03.2016. The applicant bank has also placed CRILC report to show classification of loan accounts of respondent as DA1. 19. It is thus seen that the applicant 'financial creditor' has placed on record voluminous and overwhelming evidence in support of the claim as well as to prove the default. 20. The Respondent Corporate Debtor has filed its reply on 27.03.2018 and additional objections on 01.06.2018. The respondent has raised an objection that Smt. Shivani Singla has filed the instant petition without appropriate authorisation from the applicant bank. It is argued that in the absence of relevant Board Resolution of the applicant Bank, it is not clear as to how the Chief General Manager derived its power to sub-delegate the authority in favour of Smt. Shivani Singla to file the application. In this regard the applicant bank has placed on record extracts from the 134th meeting of the Board of Directors held on 14.08.2017, wherein revision in delegation of powers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im Resolution Professional is incomplete and not as per law. In this regard it is seen that the applicant was directed vide order dated 04.06.2018 to rectify the petition and to propose a new name for appointment as an IRP. Thereafter, the applicant vide affidavit dated 12.07.2018 has proposed the name of Mr. Ravindra Loonkar, having registration number IBBI/IPA-002/IP-N00433/2017-2018/11206. The applicant has also filed Form 2 in which Mr. Ravindra Loonkar, the new proposed IRP has agreed to accept appointment as the IRP if an order admitting the present application is passed. He has also certified that no disciplinary proceedings are pending against him in Insolvency and Bankruptcy Board of India or elsewhere. In addition, further necessary disclosures have been made by Mr. Ravindra Loonkar as per the requirement of the IBBI Regulations. Accordingly, it is seen that the initial irregularity pointed out by respondent has now been duly rectified. 23. The respondent corporate debtor has also contended that its loan restructuring proposal is still under consideration of the consortium banks. Respondent accordingly disputed the claim on the ground that the present application is prem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will come within the purview of 'Financial Debt' but also the applicant bank can clearly be termed as 'Financial Creditor' so as to prefer the present application under Section 7 of the Code. 28. Under sub-section 5(a) of Section 7 of the code, the application filed by the applicant financial creditor has to be admitted on satisfaction that: 1. Default has occurred. 2. Application is complete, and 3. No disciplinary proceeding against the proposed IRP is pending. 29. Hon'ble Supreme Court in the case of Innovations Private Limited V. Kirusa Software Private Limited reported in AIR 2017 SC 4532 At Para 19 has Observed that: "Once the adjudicating authority/Tribunal is satisfied as to the existence of the default and has ensured that the application is complete and no disciplinary proceedings are pending against the proposed resolution professional, it shall admit the application. The adjudicating authority/Tribunal is not required to look into any other criteria for admission of the application." (Emphasis given) 30. As regards occurrence of default, it is the case of applicant that the authorized signatory of the respondent had admitted, acknowledged and confirmed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nancial debt. 35. As a sequel to the above discussion and in terms of Section 7(5)(a) of the Code, the present application is admitted. 36. Mr. Ravindra Loonkar, having registration number IBBI/IPA- 002/IP - N00433/2017-2018/11206, having office at RBSA Restructuring Advisors LLP, 9C, 9th floor, Hansalaya Building, 15, Barakhamba Road, Connaught Place, New Delhi-110001, email id [email protected] is appointed as an Interim Resolution Professional. 37. In pursuance of Section 13(2) of the Code, we direct that public announcement shall be made by the Interim Resolution Professional immediately (3 days as prescribed by Regulations) with regard to admission of this application under Section 7 of the Code. 38. We also declare moratorium in terms of Section 14 of the Code. The necessary consequences of imposing the moratorium flows from the provisions of Section 14(1)(a), (b), (c) & (d). Thus, the following prohibitions are imposed: "(a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority; (b) transferring, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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