9911796707
TMI Blog2023 (4) TMI 1297X X X X Extracts X X X X X X X X Extracts X X X X ..... pande, Advocate ORDER SAMEER KAKAR, MEMBER (T) 1. This Application has been filed by BEACON TRUSTEESHIP LIMITED (hereinafter referred to as 'Financial Creditor') on 14.12.2022 under Section 7 of the Insolvency and Bankruptcy Code, 2016 (I B Code) r/w Rule 4 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016, against IMPERIAL CONSULTANTS AND SECURITIES LIMITED (hereinafter referred to as 'Corporate Debtor'). The prayer made is to admit the Application, to initiate the Corporate Insolvency Resolution Process (CIRP) against the Corporate Debtor, declare moratorium and appoint Interim Resolution Professional (IRP). 2. From Part-I of the Application, it is seen that this application has been filed by Beacon Trusteeship Limited (Viz., the Financial Creditor/Applicant herein). The Financial Creditor is a Public Limited Company. The Affidavit verifying the Application is placed at page No. 31-32 of the Application typeset and the same authorizes Ms. Anuja Parab, the Authorized signatory of the Applicant Financial Creditor. 3. Part II of the Application lays down the details of the Corporate Debtor from which it is seen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount and the interest as Annexure 19 . 7. The Financial Creditor is a SEBI registered Debenture Trustee offering technology enabled solutions. 8. It is submitted that Essar Steel Metal Trading Limited, the Debenture Holder had advanced a sum of Rs. 200,00,00,000/- (Rupees Two Hundred Crores) as and by way of unsecured loan to the Corporate Debtor. The Corporate Debtor by way of a Memorandum of Arrangement of Receivables and Security dated 20.03.2020, agreed to create security in favour of the Debenture Holder in order to secure the repayment of the loan. It is in this manner that the said loan came to be secured. 9. The Debenture Holder vide its Letter dated 13.10.2020 recalled the said loan advanced to the Corporate Debtor and called upon the Corporate Debtor to plan repayment of the entire outstanding dues as soon as possible. 10. In response to the said recall notice issued by the Debenture Holder, the Corporate Debtor herein, issued a letter dated 28.10.2020, inter alia, stating that the Corporate Debtor would not be able to repay its outstanding dues in a short time, however, proposed conversion of the said loan into secured Non-convertible Redeemable Debentures i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of face value of Rs. 100/- each shall be redeemed at a price in terms as per agreement security i.e., all current assets, investments, receivables, book debts, both present and future, movable properties, immovable properties, other than those mortgaged in favour of Yes Bank Limited in the form or manner acceptable to Debenture Holder by way of hypothecation maintaining minimum security cover of 1 (One) time of the issue; ... 16. On the above understanding between the Corporate Debtor and the Debenture Holder, a Debenture Trust Agreement dated 17.12.2020 came to be executed by and between the Financial Creditor and the Corporate Debtor, inter alia, appointing the Financial Creditor as the Debenture Trustee pursuant to the provisions of Section 71(4) of the Companies Act, 2013, for the benefit of the Debenture Holder. The said Agreement also obligates the Corporate Debtor to execute a Debenture Trust Deed in terms of the Companies Act, 2013 and other applicable laws/regulations within the time as specified under the Act and also all other necessary documents as may be required under the Disclosure Document/Term Sheet. 17. The Corporate Debtor, in compliance with its obliga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uments. 19. The Corporate Debtor under Clause 5.3 of the said Debenture Trust Deed covenants with the Debenture Trustee that it shall pay to the Debenture Holder, as the case may be, the Principal Amount of the Debentures together with Coupon and/or redemption premium, if any, on the due date as mentioned in the Financial Covenant and Conditions and shall also pay interest on the Debentures in accordance with the Financial Covenants and Conditions. The Financial Creditor therefore submits that it is in the said manner that the Corporate Debtor has not only admitted its liability of repayment of debt due to the Debenture Holder but also admitted to payment of interest etc. 20. Further, Clause 8.3 of the said Debenture Trust Deed stipulates to occurrence of events that shall constitute as an Event of Default and includes default occurred in the redemption of Debentures, as and when the same shall have become due and payable as an Event of Default. 21. Clause (iii) of the FIRST SCHEDULE to the Debenture Trust Deed provides that the Corporate Debtor agrees and undertakes to redeem the Debentures on 31.12.2021 or as per the Prepayment Plan and in case of prepayment date of Re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Debtor herein on 04.01.2022, calling upon the Corporate Debtor to redeem the said Debentures and to repay the amount of loan secured alongwith interest, failing which, the Financial Creditor herein shall be constrained to initiate appropriate proceedings against the Corporate Debtor herein, which shall be completely at the costs and consequences of the Corporate Debtor. REPLY FILED BY THE RESPONDENT: 27. The Corporate Debtor has filed the reply under SR No. 1206 dated 17.3.2023 . The Respondent admits that the Applicant is the Debenture Trustee and that a Debenture Trust Agreement was executed on 17.12.2020. Respondent stated that they were undergoing financial crisis which further deteriorated with the advent of COVID-19 pandemic and that the business activities of the Corporate Debtor have suffered. Corporate Debtor further stated under para 4 of the reply that on account of inability of the Corporate Debtor to repay the said loan, an arrangement was reached between the Corporate Debtor and the Debenture Holder, wherein the Debenture Holder agreed to convert the said loan into secured Non-convertible Redeemable Debentures for securing the repayment of the principal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part V. Under Rule 4(3), the applicant is to dispatch a copy of the application filed with the adjudicating authority by registered post or speed post to the registered office of the corporate debtor. The speed, within which the adjudicating authority is to ascertain the existence of a default from the records of the information utility or on the basis of evidence furnished by the financial creditor, is important. This it must do within 14 days of the receipt of the application. It is at the stage of Section 7(5), where the adjudicating authority is to be satisfied that a default has occurred, that the corporate debtor is entitled to point out that a default has not occurred in the sense that the debt , which may also include a disputed claim, is not due. A debt may not be due if it is not payable in law or in fact. The moment the adjudicating authority is satisfied that a default has occurred, the application must be admitted unless it is incomplete, in which case it may give notice to the applicant to rectify the defect within 7 days of receipt of a notice from the adjudicating authority. Under sub-section (7), the adjudicating authority shall then communicate the order passed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uota, concession, clearance or a similar grant or right given by the Central Government, State Government, local authority, sectoral regulator or any other authority constituted under any other law for the time being in force, shall not be suspended or terminated on the grounds of insolvency, subject to the condition that there is no default in payment of current dues arising for the use or continuation of the license or a similar grant or right during moratorium period; 33. However during the pendency of moratorium period in terms of Section 14(2) and 14(3) as extracted hereunder; (2) The supply of essential goods or services to the Corporate Debtor as may be specified shall not be terminated or suspended or interrupted during moratorium period. (2A) Where the interim resolution professional or resolution professional, as the case may be, considers the supply of goods or services critical to protect and preserve the value of the Corporate Debtor and manage the operations of such Corporate Debtor as a going concern, then the supply of such goods or services shall not be terminated, suspended or interrupted during the period of moratorium, except where such Corporate Debtor ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
