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TMI Blog2022 (5) TMI 1363X X X X Extracts X X X X X X X X Extracts X X X X ..... ancial Creditor, it is liable to be proceeded against accordingly. Petition admitted - moratorium declared. - C. P. (IB) No. 590/KB/2020 - - - Dated:- 19-5-2022 - Rohit Kapoor, Member (J) And Harish Chander Suri, Member (T) For the Appellant : Avishek Guha and Neha Dutt Tewari, Advs ORDER Harish Chander Suri, Member (T) 1. The Court is convened by video conference today. 2. This petition under section 7 of the Insolvency and Bankruptcy Code, 2016 read with Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 has been filed by Tata Capital Financial Services Limited, through Mr. Suvradeep Das, Special Resolution dated 22/12/2017 (Annexure-B) (hereinafter referred to as the Financial Creditor) for initiation of Corporate Insolvency Resolution Process in respect of G.I. International Private Limited, having its registered office at 8/1 Ram Kumar Rakhit Lane, Kolkata, West Bengal-700007 (hereinafter referred to as the Corporate Debtor). 3. It is submitted by the Financial Creditor that the Corporate Debtor company obtained various credit facilities from the Financial Creditor Bank in several accounts with different su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 4,40,00,000/- (Rupees Four Crore Forty Lakh only). A copy of the Addendum Sanction Letter for Working Capital Demand Loan Facility dated 27th August, 2015 is annexed as Annexure-G, and as such Deed of Undertaking to Mortgage was also executed by Mr. Shiba Sardar being the guarantor in favour of Tata Capital Financial Services Limited on 23rd June, 2015. A Copy of the Deed of Undertaking to Mortgage dated 23rd June, 2015 is annexed as Annexure-H. 8. It is submitted that thereafter a Supplemental Agreement dated 12th August, 2015, was executed between the Corporate Debtor and the Financial Creditor, with a request of Online Disbursement of Loan, and a further request of capping the limit of the said facility at Rs. 4,40,00,000/- and that the Corporate Debtor shall not make any further request for disbursement of any amounts under the said facility over and above the amount of Rs. 4,40,00,000/- (Rupees Four Crore Forty Lakh only). A copy of the Supplemental Agreement dated 12th August, 2015 along with a copy of the Capping Letter dated 3rd September, 2015, are annexed as Annexure-I and J. 9. It is submitted that on or about the month of January, 2016 the Corporate Debtor appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor and the Guarantors, acknowledging the dues and extending the period of limitation under section 18 and 19 of the Limitation Act, 1963 and that until such dues are cleared, all such documents and relative securities shall remain in full force with the Financial Creditor. A copy of the Letter dated 26th February, 2016 is annexed as Annexure-Q. 16. It is further submitted that a Declaration was initiated on behalf of M/s. Wellbuild Plaza Private Limited, promulgating the assets made collateral to the Credit facilities obtained by the Corporate Debtor company from the Financial Creditor. A copy of the Declaration dated 27th February, 2016 is annexed as Annexure-R. 17. It is submitted that a Declaration of Equitable Mortgage dated 29th February, 2016 was also executed between M/s. Wellbuild Plaza Private Limited and Tata Capital Financial Services Limited. Thereafter, a Memorandum for recording creation of Mortgage dated 29th February, 2016, was executed between Corporate Guarantor and the Financial Creditor in support of the above mentioned Credit facility, by depositing the Title Deeds. A copy of the Declaration and the Memorandum for Recording Creation of Mortgage are colle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 28th April, 2017 acknowledging and admitting that security documents, Channel Finance Agreement, Letter of Guarantee and Power of Attorney have been executed as per the policy's and terms and conditions of the Financial Creditor. A Copy of the Letter dated 28th April, 2017, is annexed as Annexure-Z. 25. It is submitted that the Corporate Debtor has failed and neglected to serve the interest of the aforesaid Loan facilities taken from Financial Creditors in spite of repeated requests and reminders. The Corporate Debtor has also failed and neglected to clear their outstanding dues to the Financial Creditor in gross violation of terms of sanction and the Financial Creditor sent various reminders to the defendants demanding payment of the dues payable by the defendants to the applicant, but the Corporate Debtor did not comply with such demands. 26. It is submitted that since no further payments were made, the Financial Creditor was compelled to issue a demand notice to the Corporate Debtors and its Guarantors on 01/10/2018 through their Ld. Advocate. A Copy of the Demand Notice dated 01/10/2018 along with the postal receipts is annexed as Annexure-AA. The Financial Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and non joinder of necessary parties. It is further submitted that the petition is not maintainable as it has been initiated for recovery of monetary dues, which is contrary to the objects and reasons behind the enactment of the Code. It is submitted that the Financial Creditor is seeking to arm twist the Corporate Debtor for paying the monetary dues when the Corporate Debtor is facing a financial crunch. It is submitted that same is against the spirit of the Code. 30. It is submitted that the Corporate Debtor has attached a copy of the Working Capital Demand Loan Agreement dated 25th May, 2015 along with the Demand Promissory Note issued on behalf of the Financial Creditor dated 15th May, 2015 which has crossed the time period of three years and henceforth no revised copy of agreement has been attached with the main application and the same shall not be maintainable under the Limitation Act, 1963. It is further submitted by the Corporate Debtor that the Addendum Sanction letter for Working Capital Demand Loan Facility dated 27th August, 2015 and deed of undertaking to mortgage dated 23rd June, 2015, supplemental agreement dated 12th August, 2015, the Capping letter dated 3rd S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all previous transactions in the account of the Financial Creditor. It is further submitted that the demand notice dated 01/10/2018 was issued by the financial creditor for payment jointly and severally of the outstanding due amount along with applicable interest, charges in accordance with the terms and conditions of the facility agreement. 33. Ld. Counsel for the Financial Creditor submitted that last payment made in respect of Working Capital Demand Loan-II was made on 14/06/2018 and last payment in respect of Working Capital Demand Loan-I was made on 19/09/2019. 34. Ld. Counsel for the Financial Creditor has, inter alia, submitted that the Corporate Debtor has tried to make out a case that the application has been filed beyond the timeline of three years and that the Financial Creditor has no cause of action to proceed against the Corporate Debtor. It is submitted that as far as the question of limitation is concerned, the same has been dealt in detail in reply to the second contention raised by the Corporate Debtor. It is submitted that as far as the question of cause of action for institution of the present application is concerned, the Corporate Debtor has contended th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar 2017 and 2018 which have been annexed by the Financial Creditor. It is submitted that so far as the question of limitation is concerned, the only point of consideration is the date of default on which the cause of action of the Financial Creditor arose and on the date on which this application is filed. Both the dates should be within a period the three years. It is submitted that the cause of action arose on 01/10/2018 (page 401 of the petition). It is submitted that since the application has been filed on 11/02/2020, hence the application is well within the period of limitation. The Corporate Debtor has unnecessarily attempted to mislead this Adjudicating Authority and therefore, no reliance could be placed on the statement of the Corporate Debtor. It is submitted that there is no single denial by the Corporate Debtor about the existence of debt or default thereof, which is, therefore, an implicit admission of the existence of debt and default in respect thereof by the Corporate Debtor. 39. The Financial Creditor has proposed the name of Mr. Dhiren Shantilal Shah, to act as an IRP having Registration No. IBBI/IPA-001/IP-P00220/2017-18/10419, who has consented vide his affid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, 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 Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (54 of 2002); d) The recovery of any property by an owner or lessor where such property is occupied by or in the possession of the corporate debtor. v) The supply of essential goods or services rendered to the corporate debtor as may be specified shall not be terminated, suspended, or interrupted during the moratorium period. vi) The provisions of sub-section (1) shall not apply to such transactions as may be notified by the Central Government in consultation with any financial sector regulator. vii) The order of moratorium shall have effect from the date of admission till the completion of the corporate insolvency resolution process. viii) Provided that wh ..... 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