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TMI Blog2021 (6) TMI 248X X X X Extracts X X X X X X X X Extracts X X X X ..... mpany Petition. 2. Briefly stated the facts are thus. The IDBI Trusteeship Services Limited (hereinafter referred to as the Petitioner) filed Company Petition under Section 71(10) of the Companies Act, 2013 (the Act) against the Reliance Home Finance Limited (Respondent No. 1/R1) and Reliance Capital Limited (Respondent No. 2/R2) seeking direction to redeem the debentures issued by R1. It is the case of the Petitioner in the Company Petition that the R1 had issued Secured Non-Convertible Debentures (NCDs) aggregating to INR 2618,27,41,000/-, each carrying a face value of INR 1000/- and coupon interest rate payable annually to various debenture holders. 3. The Petitioner under the Debenture Trustee Agreement dated 10.11.2016 consented to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing direction to redeem the NCDs and various prohibitory reliefs with regard to the alienation or creating encumbrance on the property of the Respondents. 5. It is contended by the Applicant that on 07.06.2019, the Reserve Bank of India (RBI) issued a Circular for resolution of stressed assets. The lenders led by the present Applicant entered into an ICA to arrive at a Debt Resolution Plan for R1. The ICA lenders have appointed BOB Capital Markets Limited and Ernst & Young LLP as process advisors for conducting the bid process and finding a suitable resolution for the financial stress R1 is in. The process advisors accordingly have taken various steps inviting Expression of Interest (EoI) cum Bids inter alia for sale of assets of R1. By 18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of all the stakeholders and is entitled to be heard in the matter. Being an entity interested, Rule 73(3) & (4) of the National Company Law Tribunal Rules, 2016 (the Rules) entitles the Applicant to be heard. The Applicant accordingly under Rule 11 of the Rules has sought the following prayers. a. Allow the present Intervention Application and permit the Intervening Applicant to make its submissions on the resolution process of Respondent No. 1 by intervening in the present Company Petition; b. Dismiss the Company Petition and no order be passed in the present Company Petition that in any manner may prejudicially affect the resolution process of the Respondent; c. Any other Orders as this Hon'ble Tribunal may deem fit in the fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplication filed under sub-rule (1), that it is necessary so to do, to safeguard the interests of the company, the debenture holders or the depositors, as the case may be, or in the public interest, direct, by order, the company to make repayment of such deposit or debenture or part thereof forthwith or within such time and subject to such conditions as may be specified in the order: Provided that while passing the order, the Tribunal shall consider the financial condition of the company, the amount or deposit or debenture or part thereof and the interest payable thereon." 10. The Applicant has canvassed its intervention basing on the proviso to sub-rule (3) above. The proviso envisages that the Tribunal before making any order shall giv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sary or proper party to the Company Petition. 12. The Applicant has also taken the ground of 'public interest' as referred to in sub-rule (4) above. The provision indicates that the Tribunal may direct the Company to make payment inter alia of such debentures forthwith or within such time if it considers necessary, inter alia to safeguard the interest of the Company or in the public interest. The provision accordingly would not be extended to mean that the Tribunal would not pass any orders or would refrain from passing any orders under Section 71(10) of the Act. The provision rather means that the Tribunal taking into consideration all the antecedent factors may by an order direct the Company to make the repayment within a particu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any person/entity other than those mentioned in section 71(10) thereof. Thus, inherent powers cannot be exercised to bring in a party not contemplated under the Act. In any view of the matter, the Applicant is not entitled to be heard in an Application under Section 71(10) of the Act. 15. The statutory rights of the debenture holders cannot be sacrificed and jeopardized, under the garb of facilitating the Resolution Plan, which is yet to see the light of the day. The ends of justice certainly would not encourage or sanction such a contingency. Besides the Resolution of R1 and the rights of the Petitioner under Section 71(10) are independent of each other. The Resolution on the basis of an administrative Circular of the RBI would not thwart ..... X X X X Extracts X X X X X X X X Extracts X X X X
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