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TMI Blog2019 (9) TMI 1455X X X X Extracts X X X X X X X X Extracts X X X X ..... ents : Rishi Bhushan Jauhari, Advocate ORDER Abni Ranjan Kumar Sinha, Member (J) 1. The present petition is filed under Section 7 of Insolvency and Bankruptcy Code, 2016 read with rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rule, 2016 by the petitioner/financial creditor i.e. Corporation Bank for initiation of Corporate Insolvency Resolution Process against the Respondent/Corporate debtor company M/s. Shahjahanpur Edibles Private Limited. 2. The Applicant Corporation Bank is a Banking Institution and corporate body constituted under the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1980 incorporated on 12.03.1906 having Identification Number AAACC7245E. Sri. Jugal Kishor Srivastava, Senior Manager, has been authorised to file this application on behalf of Financial Creditor. (The Copy of the general power of Attorney is annexed as Annexure I of the application). 3. The Respondent M/s Shahjahanpur edibles Private Limited is a private limited company duly incorporated on 12.03.2014 (Having its Registered Office at, Rausar Kothi Road, Village- Mishripur, District- Shahjahanpur CIN U15400UP2014PTC063318). The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reviewed for ₹ 5,11,74,000/- (Rupees Five Crores Eleven lacs Seventy Four Thousand) to the corporate debtor. All terms and conditions of the credit sanction intimation were accepted and acknowledge by the corporate debtor in writing. iv. In respect of the aforesaid facility enhanced by the applicant and availed by the corporate debtor, the authorised representative/director executed signed and delivered to the applicant bank the following security documents on 28.06.2016. A. Cash Credit Facility for Rs,6,00,00,000/- (Rupees Six Crores) a. Demand Promissory Note for ₹ 600 lakhs (ID 901) b. Take delivery letter to D.P.N (ID 902) c. General power of attorney for book debts supply bills. B. Term Loan Facility for ₹ 5,11,74,000/- (Rupees Five Crores Seventy Four Thousand) a. Agreement for term loans (ID-12014) b. Common deed of hypothecation of movables/assets/debts (ID 12004) c. Letters of undertaking/declaration from the borrowers (ID 13001) v. Further the counsel for the applicant submitted that, to secure aforesaid credit facility of ₹ 11,11,84,000/- availed by the corporate debtor, (1) Sri Shiv Kumar Agarwa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resent company petition in part (V) the said property has been wrongly shown to have been mortgaged with the Financial Creditor and only further charge has been created by way of continuing security for the financial assistance given to the company and as such until and unless the loan taken by the firm Budhram Ishwar Chandra is repaid, no amount alleged to be due upon the company can be recovered from the said property and no R.P. can be appointed for managing the said property. ix. Further stated, that the loan accounts became NPA and the Corporation Bank started proceedings under SARFAESI Act 2002 and the notice under Section 13(2) was issued on 09.08.2018 and the possession notice was issued on 13.09.2018 regarding both the aforesaid properties. However, the same were withdrawn. x. Further it is submitted in the counter affidavit by the counsel for the respondent that even after the filing of the present petition, in response to the reply of the Corporate Debtor with regard to the objection to the allotment, of the account to the recovery agency, the Financial Creditor through letter dated 11.04.2019 has advised the Corporate Debtor to cooperate for settlement of acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d as Annexure 33 of the Application. vii. The copy of the valuation report and CIBI and CRILIC Report is annexed as Annexure 34 and Annexure 35 of the Application respectively. 6. I have gone through the contents of the petition, the counter affidavits filed by the respondent and reply to the counter affidavit filed by the petitioner and documents annexed there of. 7. Further, it is matter of record as per record of the financial creditor account of the corporate debtor was declared NPA on 31.03.2018 and Applicant/Financial Creditor has filed this application on 14.02.2019, which is within the limitation period. 8. From the perusal of the counter affidavit filed on behalf of the respondent, I find that respondent has raised the question of maintainability on the ground referred in the counter affidavit. I have carefully examined the ground mentioned on counter affidavit along with the provisions contained Under Section 7 of IB Code. The relevant provision of Section 7(1), (2), (3) as quoted below : Section 7: Initiation of corporate insolvency resolution process by financial creditor: (I) A financial creditor either by itself or jointly with [other financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence of such a dispute, the operational creditor goes out of the clutches of the Court. On the other hand, as we have seen, in the case of a corporate debtor who commits a default of a financial debt, the Adjudicating Authority has merely to see the records of the information utility or other evidence produced by the Financial Creditor to satisfy itself that a default has occurred. It is of no matter that the debt is disputed so long as the debt is 'due', i.e., payable unless interdicted by some law or has not yet become due in the sense that it is payable at some further debt. It is only when this is prove to the satisfaction of the adjudicating authority may reject an application and not otherwise . 11. In the case of Amy Agarwal vs. Central Bank of India (2018) 208 Comp Cas 402(NCLAT) Hon'ble NCLAT held : When in case a Corporate Debtor commits a default of financial debt, the adjudicating authority has merely to see the records of the information utility or other evidence produced by the financial creditor to satisfy itself that a default has occurred. Other considerations, such as the existence a dispute or discrepancy are irrelevant, so long it h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... posing of by the corporate debtor any of its assets or any legal right or beneficial interest therein; iii. Any action to foreclose, recover or enforce arty 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(54 of 2002); iv. The recovery of any property by an owner or lessor where such property is occupied by or in possession of the corporate debtor. It is further directed that: (i) The supply of essential goods or services to the corporate debtor as may be specified shall not be terminated or suspended or interrupted during the moratorium period (ii) The provision of sub-section (J) shall not apply to such transaction as may be notified by the Central Government in consultation with any financial sector regulator. 17. The IRP shall comply with the Provision of Section 13(2), 15, 17 18 of the Code. Further, the Directors, Promoters or any person associated with the Management of the Corporate Debtor are directed to cooperate to the IRP as prescribed under Section 19 and for discharging his function ..... X X X X Extracts X X X X X X X X Extracts X X X X
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