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TMI Blog2021 (2) TMI 464X X X X Extracts X X X X X X X X Extracts X X X X ..... vessels. Mr. Rohan Rajadhyaksha also fairly conceded that the financial creditor has no objection for excluding the sale proceeds of the vessel MT Premmala presently lying with the Bombay High Court in the pending appeal filed by State Bank of India from the purview of the CIRP process of this Company Petition - there are no merits in any of the contentions raised by the Corporate Debtor as they are beyond the scope of Section 7 of the Code. Application admitted - moratorium declared. - C. P. (IB) 4404/2019 - - - Dated:- 8-2-2021 - Hon ble H. V. Subba Rao, Member ( Judicial ) And Hon ble Shyam Babu Gautam , Member ( Technical ) For the Financial Creditor : Mr. Rohan Rajadhyaksha a/w. Mr.Vividh Tandon a/w. Mr. Prakshal Jain and Kaazvin Kapadia, Advocates i/b Trilegal For the Corporate Debtor : Mr. Manaswi Agarwal and Mr. Yash Badkur, Advocates i/b Meraki Chambers. ORDER Per : H. V. Subba Rao , Member ( Judicial ) 1. This Company Petition is filed by ICICI Bank, (hereinafter called Financial Creditor ) seeking to set in motion the Corporate Insolvency Resolution Process (CIRP) against Mercator Ltd. (hereinafter called Corporate Debtor ) by invok ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facility. iii. Pursuant to Facility III Agreement, the total amount of USD 5 million was disbursed by the Applicant to the Coroprate Debtor in two tranches, on 23 December 2016 and 3 January 2017. 6. Facility IV i. Vide Credit Arrangement Letter dated 2 December 2016 (Facility IV CAL), The Applicant, at the request of the Corporate Debtor, sanctioned term loan facility up to overall limits not exceeding INR 469 million (Rupee equivalent for USD 7 million). ii. Subsequently, on 30 December 2016, by way of Corproate Rupee Loan Facility Agreement entered into between the Applicant and the Corporate Debtor (Facility IV Agreement), the applicant, at the request of the Corporate Debtor, agreed to provide the Corporate Debtor a Rupee term loan not exceeding INR equivalent of USD 7 milliion. 7. Both Facility III and IV granted by the Applicant to the Corporate Debtor are secured by way of securities as set out below: i. Mortgage: The Coporate Debtor executed a Statutory Deed of Mortgage dated 10 March 2017 creating first pari passu charge over the vessels Uma Prem, Darshani Prem and Tridevi Prem ( Vessels ) in favour of the Applicant. A copy of the said Statutory Deed of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted that the Corporate Debtor is uable and/or unwilling to pay the Applicant and hence, it is just and equitable that insolvency proceedings be initiated against the Corporate Debtor under the provision of Section 7 of the Code. 14. In view of the above, the Applicant in the interest of an effective resolution of the debt of the Corporate Debtor, has preferred the present Application before this Tribunal to initiate the insolvency resolution process of the Corporate Debtor. This is without prejudice to the Applicant s rights to initiate other proceedings available under law. 15. The respondent Corporate Debtor filed affidavit in reply of Mr. Sagar Patil, the Authorized Representative and additional affidavit in reply of Shalabh Mittal as follows: i. The petitioner is not entitled to any relief in the above petition or otherwise and the petition is filed by the petitioner with malafide intention to hinder and wrongfully avail the assets of other secured creditor of the Corporate Debtor. The respondent CD further contents that the above petition is filed with malicious intent for purpose other than resolution of insolvency of the Corproate Debtor and therefore the same is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... email dated September 7, 2019 addressed by the Corporate Debtor to the Applicant (annexed at at Exhibit B to the affidavit in reply) and email dated September 3, 2019 addressed by the Corporate Debtor to the Applicant (annexed at page No. 133 as part of Exhibit C to the affidavit in reply). However, the Corporate Debtor continued to co-operate with the petitioner so that the petitioner could take the said vessels and realise its outstanding dues. iv. On December 19, 2019, the Corporate Debtor addressed a letter to the Petitioner and offered to pay an amount of ₹ 38,00,00,000 (Rupees Thirty Eight Crores Only) towards one time settlement of all the outstanding dues of the petitioner owed by the Corporate Debtor. Pertinently, the petitioner, without due consideration to the one time settlement offer made by the Corporate Debtor, addressed a letter dated December 24, 2019 and rejected the said offer without giving any cogent reason. v. The respondent contends that the petitioner let the value of its security to depreciate which reduced the security cover of the petitioner s debt. Having falied to realise the security interest in respect of the debt owed by the Corporate Deb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the above circumstances, the Corporate Debtor in order to reduce to debt towards the Petitioner sold its vessel Sisouli Prem being a VLGC (Very Large Gas Carrier) in December 2018 and discharged liability of accrued interest and payment of ECB of USD 5 million in full and partial instalments due in September 2018. Thus, the Corporate Debtor made best attempts to repay the outstanding dues of the Petitioner from the assets which were provided to the Petitioner as security to repay the financial facilities availed from the petitioner. ix. In view of the Petitioner deliberately dragging its feet to monetise the dredgers charged to the Petitioner and the continued deterioration in the condition of the said dredgers, the Corporate Debtor vide an email dated September 7, 2019 requested the Petitioner to take over the charge of the said three dredgers and recover the outstanding dues of the petitioner from the sale of such dredgers. Despite the email dated September 7, 2019, the Petitioner neither suitably responded to the Corporate Debtor nor took any effective steps to monetise Darshani Prem and Uma Prem. Consequently, Uma Prem was arrested by the Hon ble Bombay High Court vid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the code as per the law laid down by the Hon ble Apex Court in the case of Mardia Chemicals Vs. Union of India. In order to prove the existence of the debt and default, he invited the attention of this tribunal to pages 285 to 287 under Annexure J in which the details of disbursement of the debt and default of each financial facility provided by the financial creditor are clearly mentioned. The counsel appearing for the petitioner also invited the attention of this tribunal to clause 8 of the deed of mortgage entered into between the financial creditor and the corporate debtor in which the corporate debtor undertook to maintain each vessel financed by the financial creditor in a seaworthy condition under the deed and argued that it is the duty of the corporate debtor to maintain the vessel seaworthy. 19. He also relied upon various minutes and the correspondence annexed to the additional affidavit in reply dated 12.02.2020 filed by Corporate Debtor. It is the submission of Mr. Rohan Rajadhyaksha that lenders in principal agreed to take the proposal expeditiously for approval of the sale of the dredgers in their minutes of meeting dated 3.06.2019 and also invited the attent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority in admitting the company petition. As rightly contended by the petitioner the Adjudicating Authority has to merely look into the existence of debt and default for admitting a Company Petition under Section 7 of the code as per law laid down by Hon ble Supreme Court in various judgments. When once the debt and default is proved the company petition has to be admitted. Even otherwise the petitioner successfully demonstrated before this Tribunal that the subject matter of the vessels could not be disposed of by the financial creditor on account of their own mishandling of the financial affairs of the corporate debtor accumulating the losses and maritime liens on the vessels. 24. Mr. Rohan Rajadhyaksha also fairly conceded that the financial creditor has no objection for excluding the sale proceeds of the vessel MT Premmala presently lying with the Bombay High Court in the pending appeal filed by State Bank of India from the purview of the CIRP process of this Company Petition. 25. For the reasons stated above there are no merits in any of the contentions raised by the Corporate Debtor as they are beyond the scope of Section 7 of the Code. Therefore, the above company p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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