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TMI Blog2021 (11) TMI 187X X X X Extracts X X X X X X X X Extracts X X X X ..... by limitation. In the Corporate Debtor's respectful submission, limitation is an issue of jurisdiction which precludes this Tribunal from granting any relief to the Applicant Bank. This also renders the Insolvency Application as not maintainable. The Bench is of the clear view that there is a Financial Debt in terms of Section 5(8) and there is default in terms of Section 3(12). The limitation aspect raised by the Corporate Debtor does not hold good. Petition allowed - moratorium declared. - C. P. No. 4468/IBC/MB/2018 - - - Dated:- 6-10-2021 - Hari Venkata Subba Rao, Member (J) And Chandra Bhan Singh, Member (T) For the Appellant : Shyam Kapadia, Fatema Kachwalla and Jash Shah, Advs. i/b J. Sagar Associates For the Respondents : Ashish Kamat, Kunal Mehta, Gautam Sahni and Prakriti, Advs. i/b Vesta Legal ORDER Chandra Bhan Singh, Member (T) 1. This Company petition is filed by Standard Chartered Bank London. (hereinafter called Financial Creditor ) seeking to initiate Corporate Insolvency Resolution Process (CIRP) against Khubchandani Hospital Private Limited. (hereinafter called Corporate Debtor ) by invoking the provisions of Section 7 Insol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ditor, by way of its letter dated 24.11.2015 sought permission of the Reserve bank of India to accelerate the Facility in view of the fact that the Corporate Debtor has defaulted on the interest repayment since June 30, 2015 and aggregate amount outstanding as on November 24, 2015 was USD 351,025.61/- with a maximum ageing of 153 days due to which the account of the Corporate Debtor with the Financial Creditor was declared as a Non-Performing Asset. The Reserve bank of India by way of its letter dated December 7, 2016 granted the Financial Creditor permission to accelerate the facility. 6. Thereafter, on January 5, 2017 the Financial Creditor issued an acceleration notice in accordance with Clause 5.8 of the Facility Agreement whereby the Financial Creditor cancelled the Facility and declared all monies outstanding (whether or not otherwise due) under the Facility as being immediately due and payable or otherwise payable on demand. However, no response was received by the Financial Creditor to the said acceleration notice. Subsequently, the Financial Creditor issued several default notices to the Corporate Debtor calling upon the Corporate Debtor to comply with its obligations u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lable to the corporate debtor, with a reasonable opportunity to deal with an/or exercise legal/statutory rights in relation to such a reasoned order. It is therefore both, appropriate and in the fitness of things that these objections be heard and decided prior to the Corporate Debtor being required to respond to the petition on merit. 11. On 22.05.2013, the applicant bank and the Corporate Debtor entered into a Facility Agreement for a loan of up to USD 49 million only ( Facility Agreement ). Further the Corporate Debtor submitted that on 19.08.2013, the Applicant Bank and the Corporate Debtor entered into an Amendment and Supplemental Agreement to the Facility Agreement, by which, the amount of the loan was reduced to USD 45 million only (Supplemental Agreement). 12. On 22.05.2013, the Applicant Bank and the Corporate Debtor entered into a Sponsor Support Agreement. A perusal of this agreement demonstrates that the consideration for the same is the facility of USD 49 million. It is therefore an agreement which has a monetary value, however the stamp duty paid thereon was ₹ 200/- it is therefore insufficiently stamped. 13. Therefore on 15.06.2013, the Corporate Debt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not maintainable. The Insolvency Application is incomplete 17. The Corporate Debtor submits that the Insolvency Application filed by the Applicant Bank is not accordance with Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, since the certificate from banker under Section 2A of the Bankers' Books Evidence Act, 1891 is not enclosed. It is submitted that if the aforesaid requirement/compliance was specified as optional, then the Insolvency Application would be maintainable, however, the prescribed format of the Form-1 and the applicable rules have not classified this requirement as optional. Therefore, in the absence of any such certificate, an insolvency application filed by a financial creditor would be incomplete. 18. Further, it is settled position of law that if an application filed under Section 7 of IBC is not in compliance with the mandatory provisions or the same in incomplete, such an applicable is liable to dismissed on account of lack of evidence in support of default. The interest and other charges charged by the Applicant Bank are unfair and usurious 19. Pursuant to the Facility Agreement, the Company was sanctioned an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... btor states and submits that the Applicant Bank has been forwarding statements pertaining to the calculation of interest as applicable on the facility, but the passwords to access the said statement has not been provided to the Corporate Debtor till date. In the circumstances the Corporate Debtor submits that it has not supporting documents/statements to verify or corroborate the claim of the Applicant Bank. 25. The Corporate Debtor submits that the following documents/instruments which are annexed to the Insolvency Application and which the Applicant Bank wrongly seeks to rely upon are all insufficiently stamped as per the provisions of the Maharashtra Stamp Act, 1958: (i) Share Pledge Agreement dated 15.06.2013 (ii) Facility Agreement dated 22.05.2013 (iii) Amendment Supplemental Agreement to the Facility Agreement dated 19.08.2013 (iv) Sponsor Support Agreement dated 22.05.2013 26. The Corporate Debtor further submits that the fact that all of the aforementioned facility instruments are insufficiently stamped, they are liable to be impounded by this Tribunal and until and unless applicable stamp duly thereon is paid by the Applicant Bank, this Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the Corporate Debtor. The Bench further notes that as per Facility Agreement the interest due on the principal amount was to be repaid as per Clause 6.2 of the Facility Agreement. The Bench also notes that on June 30, 2015, the Corporate Debtor failed to pay interest due on the Facility and therefore, caused event of default as per Clause 13 of the Agreement. 31. It is pertinent to note that as a result of above-mentioned defaults, the Financial Creditor wanted to accelerate the facility and therefore on November 24, 2015 sought permission of the RBI to accelerate the Facility in view of the fact that the Corporate Debtor has defaulted on the interest payment since June 30, 2015. The Bench notes that vide letter of December 7, 2016 RBI granted the Financial Creditor permission to accelerate the Facility. Thereafter, on 5th January 2017, the Financial Creditor issued an acceleration notice in accordance with 5.6 of the Clause of the Agreement and thereafter, cancelled the Facility and declaring the monies as outstanding, whether or not otherwise due. The Financial Creditor further asked the Corporate Debtor to immediately pay all the amounts. The Bench also notes that thereafte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation... . 33.2. The Bench notes that in the present case, the Petitioner had initiated CIRP with default date 30.11.2015 when the first instalment of principal and interest were payable. Further, the Petition was filed on 29.11.2018 which is within the period of limitation as contemplated in BK Educational Services Private Limited. The Bench also notes that the Financial Creditor has only claimed the amounts which are due on and after 30.11.2015 which is well within the limitation period. 33.3. The Bench notes that the Corporate Debtor had contended that in this matter the repayment was to be made in tranches and, therefore, default in the first tranche which is beyond three years would render claims in respect of other subsequent tranches which are within three years still become time barred. 33.4. The Bench does not find logic in this argument and also the existing law does not give fillip to such logic. The Bench notes that it is true that the amount which fell due on 30.06.2015 is time barred. However, it does not render any amount which is due after 30.11.2015 as time barred. The Bench carefully notes here that all the amounts which has been claimed by the Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that there is a Financial Debt in terms of Section 5(8) and there is default in terms of Section 3(12). The limitation aspect raised by the Corporate Debtor does not hold good. The Financial Creditor also suggested the name of Interim Resolution Profession along with his consent letter in Form II. Thus, the present Company Petition satisfies all the necessary legal requirements for admission. 37. Therefore, the Company Petition bearing no. 4468/2018 deserved to be admitted and consequently the M.A. bearing no. 613/2019 filed by the Corporate Debtor deserved to be dismissed. Accordingly, the M.A. is dismissed and Company Petition is admitted by passing following: ORDER a. The above Company Petition No. (IB) - 4468/(MB)/2018 is hereby allowed and initiation of Corporate Insolvency Resolution Process (CIRP) is ordered against Khubchandani Hospitals Pvt. Ltd. b. This Bench hereby appoints Mr. Anshuman Chaturvedi ([email protected]), Insolvency Professional, Registration No: IBBI/IPA-001/IP-P00158/2017-18/10327 as the interim resolution professional to carry out the functions as mentioned under the Insolvency Bankruptcy Code, 2016. c. The Financial Creditor shal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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