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TMI Blog2019 (4) TMI 1751X X X X Extracts X X X X X X X X Extracts X X X X ..... urred within the meaning of Section 4 of the Code and the application under sub-section 2 of Section 7 is complete; and no disciplinary proceedings are pending against the proposed Interim Resolution Professional. Thus, the application warrant admission as it is complete in all respects. Petition admitted - moratorium declared. - (IB)-854/(PB)/2018 - - - Dated:- 30-4-2019 - MR M.M. KUMAR, PRESIDENT AND S.K. MOHAPATRA, MEMBER (T) For The Petitioner : Mr Sumesh Dhawan Kumar, Anurag Singh, Zain A. Khan, Ms. Vatsala Kak, And Jayakrishnan, Advocates For The Respondent : Mr Jatin S. Sethi And Shivaang Gupta, Advocates JUDGMENT M.M. KUMAR, PRESIDENT The Financial Creditor -M/s. Indiabulls Housing Finance Limited has filed the instant application under Section 7 of the Insolvency and Bankruptcy Code, 2016 (for brevity the Code ) with a prayer to trigger the Corporate Insolvency Resolution Process in the matter of BHA Associates Private Limited (for brevity the Corporate Debtor ). It is appropriate to mention that the financial creditor is a company incorporated on 10.05.2005 under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.05.2008 and consequent upon acceptance of the offer of the aforesaid loan, an agreement dated 31.05.2008 was executed between the parties. The Financial Creditor had disbursed entire loan amount of ₹ 2,00,00,000/- (Rupees Two Crore Only) on 31.05.2008. 6. As per the aforesaid loan agreement, loan facility was sanctioned for tenure of 10 years and the interest was payable @ 15.75% per annum minus margin (being -0.25% per annum) aggregating @ 15.50% per annum, applicable at that point of time. However, the interest was variable in nature. On account of variation in the rate of interest, the EMIs, in value or in number, were liable to be changed. The loan facility was repayable in 120 instalments. Copies of sanction letter and loan agreement have been placed on record (Annexure F N). 7. In order to secure the loan facility and in terms of the sanction letter dated 31.05.2008, the Corporate Debtor, with an intention to create security interest/charge in respect thereof, deposited the original retail/commercial space buyer s agreement dated 17.03.2008. An application in this regard also submitted before the Registrar of Companies and in turn, cert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with a subject Restructuring of loan A/c No. HLAPKBA00038651 wrote by the respondent to the petitioner. 2. The Respondent has issued numbers letters/reminders to the petitioner for reconciliation of the account giving effect to the access amount charged by the petitioner by charging excessive interest than agreed but the petitioner has not corrected its own mistakes despite giving assurance at various occasions. 3. The petitioner, however, did not reconcile its accounts and instead of reconciling the account, initiated action u/s. 13 (2) of the SARFAESI Act vide notice dated 22.08.2017. 4. The Respondent has also challenged the action of the petitioner by way of Securitization Appeal filed and pending before DRT-II, New Delhi, disputing the debt and praying to hold that the declaration of the account as NPA was in violation of RBI Guidelines. 5. There are no over dues as of date, if, the petitioner reconciles its accounts and give credit to the bona fide dues charged from the respondent and in the absence of any overdues, there would be no default and the account would become regular. The respondent has so far rep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eement. A close glance on the contents of the amendatory agreement it is patent that the respondent approached the petitioner regarding change in the rate of interest and alike adjust the tenure/tenor of repayment of the loan amount. As per the schedule on the date of execution of the amendatory agreement the remaining loan amount was to be ₹ 18966123.95 which was agreed to be paid in the tenure of 180 months. In the said agreement it is clearly mentioned that the rate of interest would be floating in nature which on the date of execution of the agreement was 12%. The veracity and sanctity of the said agreement cannot be doubted that too in the teeth of when seal and signature of the are Respondent affixed on the said agreement. Further the Respondent has not disputed the said agreement. Thus, since the said agreement specifically states that the rate of interest agreed between the parties was floating in nature then the Respondent cannot escape by saying otherwise. The Financial Creditor has pointed out that the Corporate Debtor had failed to repay instalments as per the terms of the loan agreement. 15. It is pertinent to mention here that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the respondent that the account of the Corporate Debtor has been wrongly declared as NPA. While dealing with application under Section 7 of the Code, it is immaterial to see as to when the account was declared as NPA. In Section 7 application, it is only to be considered as to whether there is a debt due in law and facts and whether there has been a default in paying the financial debt. 20. Hon ble National Company Law Appellate Tribunal in the case of Ranjit Kapoor v. Asset Reconstruction Company (India) Ltd. in [Company Appeal (AT) (Insolvency) No. 410 of 2018 dated 30-10-2018] has held that the provision of NPA relates to SARFAESI Act, 2002 and has nothing to do with Code . Therefore, the objection of the Respondent that the Financial Creditor has wrongly declared the account as NPA, cannot be a ground to reject the application preferred by Financial Creditor under Section 7 of the Code, there being default in payment of financial debt. 21. It is thus patent that all requirements of Section 7 of the Code for initiation of Corporate Insolvency Resolution Process by a Financial Creditor stand fulfilled. In that regard, the application is complete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expression immediately means within three days as clarified by Explanation to Regulation 6 (1) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016. 26. We also declare moratorium in terms of Section 14 of the Code. A necessary consequence of the moratorium flows from the provisions of Section 14 (1) (a), (b), (c) (d) and thus the following prohibitions are imposed which must be followed by all and sundry: (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, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; (c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; (d) the recovery of any proper ..... X X X X Extracts X X X X X X X X Extracts X X X X
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