9911796707
TMI Blog2024 (8) TMI 854X X X X Extracts X X X X X X X X Extracts X X X X ..... l are:- 2.1. Central Bank of India issued a sanction letter dated 27.11.2013 wherein certain credit facilities were sanctioned to the Corporate Debtor which included Cash Credit, Term Loan Non-Fund Based Limits. On 22.08.2015, a Corporate Guarantee deed was executed by the Corporate Debtor- Superfine Profile and Extrusions Pvt. Ltd. to indemnify the Central Bank of India Consortium for an amount not exceeding Rs.73.61 Crore. Another Corporate Guarantee Deed was executed on 18.11.2016 by the Corporate Debtor in favour of Central Bank of India, Indian Bank and Oriental Bank of Commerce (Now Punjab National Bank). On 26.12.2019, letter of sanction was issued by the Central Bank of India to Superfine Metals Pvt. Ltd., the Principal Borrower for Ad hoc Limit of Rs.3.70 Crores. Another sanction letter dated 09.09.2020 was issued for FITL Scheme for a sum of Rs.3,16,90,762/-, in sanction letter dated 26.12.2019 and 09.09.2020, Bank of Maharashtra was also added in Consortium but no disbursement took place by the Bank of Maharashtra). On 06.11.2020, new Corporate Guarantee was executed for the Central Bank of India, Indian Bank, Oriental Bank of Commerce (now PNB) and Bank of Maharashtra. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in considering the proposal, however, the formation of CoC not to be interdicted. Let the Bank takes a decision on the restricting proposal submitted by the Appellant within two weeks from today. Let the CoC be constituted but no further action shall be taken by the CoC till the next date. List this Appeal on 09.02.2024. It shall be open for the Respondent to file an affidavit before the date fixed." 4. In the Appeal, there has been further orders to await the outcome of re-structuring proposal. A detailed order was passed on 09.04.2024 listing the appeal on 13.05.2024 providing that all necessary reports for the Bank may be called for regarding the re-structuring proposal. Interim order was extended. On 22.05.2024, again following order was passed by this Tribunal:- "22.05.2024: Learned Counsel for the appellant referring to Additional Affidavit submits that bank had issued a letter dated 10.5.2024 indicating that no Binding Letter from Investor has yet been received. Ld. Counsel for the appellant submits that Investor has already noticed the said letter and within a short period of a week or a ten days the binding offer will be given by the Investor to the Bank and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding could have been initiated. It is submitted that by subsequent sanction letters dated 26.12.2019 and 09.09.2020 and the guarantee dated 06.11.2020, contract between the parties have been novated. It is submitted that in view of the novation of the contract between the parties by virtue of Section 62 of the Contract Act, the original contract need not be performed. 9. Counsel for the Respondent refuting the submissions of the Counsel for the Appellant submits that earlier sanction letter and guarantee deed dated 22.08.2015 and 18.11.2016 still binds the Corporate Debtor by subsequent sanction letters dated 26.12.2019 and 09.09.2020, the existing securities were continued. Existing securities including the aforesaid guarantees dated 22.08.2015 and 18.11.2016 being continuing, Bank has rightly invoked the guarantees dated 22.08.2015 and 18.11.2016. It is submitted that non-invocation of guarantee dated 06.11.2020 is inconsequential. It is submitted that the disbursements were made to the Corporate Debtor consequent to the sanction letter dated 27.11.2013 and thereafter disbursement having been made by the Financial Creditor for which repayments having not been made by the Princip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s disbursed from time to time to Superfine Metal Pvt Ltd wherein your company has given corporate guarantee. We have to inform you that the principal borrower ie. Superfine Metals Pvt Ltd has committed defaults in payment of their liabilities and consequently their account has been classified as a non-performing asset. A copy of the notice dated 29.06.2022 under section 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and Recall Notice dated 02.01.2023 sent by us to the Principle borrower is enclosed. Since the borrower has committed defaults. in terms of the guarantee deed dated August 22, 2015 and November 18, 2016, Superfine Profile and Extrusions Pvt Ltd have become liable to pay to us the outstanding amount of loan/credit facilities aggregating balance O/s as of 06.03.2023 Rs. 94,71,23,119.18/- (Rupees Ninety Four Crore Seventy One Lakhs Twenty Three Thousand One Hundred and Nineteen and Eighteen Paisa) exclusive of other charges, and we hereby invoke the corporate guarantee and call upon you to pay the said amount within 10 days from the date of this notice, failing which we have been instructed to initiat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Corporate Debtor dated 22.08.2015 and 18.11.2016 have been brought on the record by the Appellant. Clause 1 of the Guarantee Deed dated 22.08.2015 provide that if any time default shall be made by the borrower in payment, the guarantors shall forthwith on demand pay to the Central Bank of India amount not exceeding Rs. 73.61 Crores. Para 1 of the Guarantee Deed is as follows:- "1. If any time default shall be made by the borrower in payment of the principal sum (not exceeding Rs 73.61 Crores) together with interest, costs, charges, expenses and/or other money for the time being due to the Central Bank of India consortium in respect of or under the above mentioned credit facilities or any of them the guarantors shall forthwith on demand pay to the Central Bank of India consortium the whole of such principal sum (not exceeding Rs 73.61 Crores) together with interest, costs, charges, expenses and or any other money as may be then due to the Central Bank of India consortium in respect of the above mentioned credit facilities and shall indemnify and keep indemnified the Central Bank of India consortium against all losses of the said principal sum, interest or other money due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons and discounting of demand and /or Usance bills and cheques inland as well as foreign and such other facilities as may be agreed upon from time to time between the bank and the borrower (hereinafter called the above mention facilities) for sums not exceeding in the aggregate the sum of Rs. 92.47 crores (hereinafter for the sake of brevity referred to as the principle sum) on the terms and conditions specified and contained therein." 16. The submission made by the Appellant of novation of the contract and non-invocation of the subsequent guarantee dated 06.11.2020 is based on sanction letters dated 26.12.2019 and 09.09.2020 which according to the Appellant is sanction of further amount which amount has been claimed as a debt under Part IV and there being no invocation of guarantee dated 06.11.2020, application under Section 7 is not maintainable. 26.12.2019 is a sanction issued by the Central Bank of India to Principal Borrower with regard to Ad-hoc Limit of Rs.3.70 Crores for a period of 90 days. Letter dated 26.12.2019 contains following:- "BR/AHMPOO/2019-20/1 Date: 26/12/2019 SUPERFINE METALS PVT. LTD., 1267, PRATIBHA, DALMANDAI, AHMEDNAGAR-414001 Reg: Adhoc Limit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erest in working capital facility. 4. Loan Amount Rs. 3,16,90,762.00 5. Facility type Term Loan 6. Rate of Interest 10.30% pa. Rate of interest as being applied on the existing FBWC limit of the borrower. 7. Repayment term 6 Instalment of Ra. 52,81,794 + Interest. Commencing from 1st October 2020. FITL shall be repayable fully not later than 31.03.2021 8. Documentation Agreement for FITL OTHER TERMS AND CONDITIONS- 1. Any unpaid arrears of interest/Instalments/Charges pertaining to 01/03/2020, will be repaid before disbursement. 2. The instalments in the term loan falling due during the period from 01/*/* to 31/08/2020 in respect of Term Loan will be repaid by you as per the * repayment schedule by extending the tenor of the loan as allowed in the Regulation Package. 3. All necessary agreements on account of the above deferment of interest / allowing moratorium to be executed before disbursement of FITL. 4. All existing securities in the captioned facilities will continue to be the security for the existing facilities with the revised repayment schedule. Further the said securities will also cover the fresh FITL facility opened to park the interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is Rs.1,23,600/-. FITL was disbursed on 30.09.2020 and Cash Credit Adhoc disbursed on 26.12.2019. We have already noticed that the disbursement of FITL and Cash Credit Adhoc was fully covered by Cash Credit Facilities and Cash Credit were all covered by the earlier bank guarantees. When the Corporate Debtor was bound by the earlier bank guarantees dated 22.08.2015 and 18.11.2016 which guarantees are still continuing, we cannot accept the submission of the Appellant that by virtue of guarantee dated 06.11.2020 which was for Term Loan of Rs.114.22 Crores, earlier guarantee has wiped off and are not in existence. Guarantee dated 06.11.2020 in no manner take away the earlier securities including the guarantee which was executed by corporate guarantor in favour of the Financial Creditor. The Consortium Agreement which was executed on 06.11.2020 between the parties clearly mentions that it was not to affect existing securities. We, thus, do not find any novation of contract between the parties. Disbursement made pursuant to sanction made in the year 2013 and the guarantees issued by the corporate guarantor on 22.08.2015 and 18.11.2016 are still continuing and binds the corporate guaranto ..... X X X X Extracts X X X X X X X X Extracts X X X X
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