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TMI Blog2024 (12) TMI 1246X X X X Extracts X X X X X X X X Extracts X X X X ..... e tune of Rs.40 Crores, Rs.10 Crores was extended by the SBH and Rs.30 Crores was said to have been extended by the Appellant (Canara Bank). While the project was being laid, the Corporate Debtor felt that the finances were falling short, and hence, the Corporate Debtor intended to avail of an additional credit facility due to the increased project cost, and accordingly the Corporate Debtor has sought a sanction of an additional term loan to the tune of Rs.25 Crores. 2. The Appellant self-submitted that, despite of the extension of the aforesaid assistance by each members of the consortium which included the Appellant also, the Corporate Debtor i.e, the respondent herein could not receive the estimated revenue, as anticipated by the Corporate Debtor from the proceeds. The Corporate Debtor is said to have resorted to, a restructuring of the financial assistance mechanism, so as to upgrade its financial capability and to improve it in a manner to satisfy, the loan, which was extended by the members of the consortium. 3. However, despite the best efforts made by the Respondent (Corporate Debtor), the object thus aimed at by the Respondent, for the establishment of the hotel, was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich was demanded to be made payable on or before 28.02.2019. The aforesaid correspondences, and more importantly the demand of 29.08.2018, is being taken as to be determining the default which is taken which is taken to have been committed when the notices were issued for raising a demand, by invocation of Section 7 of I & B Code. 6. The appellant had come up with the case that, though the Corporate Debtor has acknowledged the amount due to be paid as per letter dated 29.08.2018 for the tune of Rs. 30 Crores, by the correspondence dated 30.10.2018, the Corporate Debtor has not remitted the amount due to be paid. And hence, the necessity arose for invocation of the proceeding under Section 7 of I & B Code. 7. It is not a dispute that, while the appellant was invoking the proceeding under Section 7 of I & B Code, simultaneously the Appellant has also been participating in the process of an OTS, which was being ventured into between the members of the consortium and the Corporate Debtor. But the terms of settlement, which was thus incorporated in the OTS were not acceptable, hence the Financial Creditor withdrew from the extension of the OTS offer, and the withdrawal was said to hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellant had preferred Writ Petition before the High Court of Telangana, which was numbered as Writ Petition No. 14178/2021, and the same is still pending consideration. 11. In the writ petition thus preferred, before the High Court of Telangana, the Appellant who is a petitioner therein, had prayed for, the relief to the effect that, for granting a writ of certiorari, quashing the order passed by DRAT in regular appeal on 09.04.2021. And, quash the order passed in OA No. 3549/2017, on the file of the Debt Recovery Tribunal (DRT), Hyderabad and declared that the order of the Debt Recovery Tribunal (DRT) dated 03.01.2020, as well as the order of the Appellate Authority being contrary to the circulars, which has been issued by the Reserve Bank of India. Which itself the process regulating the parameters for the grant of the OneTime Settlement. With reference hereto, the appellant mentions circular of the Reserve Bank of India being Reference No. RBI/2013-14/503DBOD.BP.BC No.97/2104.132/2013-14 dated 26.02.2014. 12. Though, what implication the circular of the Reserve Bank of India dated 26.02.2014, would have as against the orders passed under Section 19 and 20 of the Recover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merges for consideration, is that what would be the criteria to determine, as to what would be the date of default has to be, either 01.10.2012 or 03.01.2020, where the OTS/Compromise was in favour of the Financial Creditors was ultimately withdrawn in the meeting of the members of consortium on 04.02.2019. When these issues were taken up, the Ld. Adjudicating Authority, by the Impugned Judgment dated 28.02.2022 had rejected the application preferred under Section 7 of I & B Code, by observing thereof, that when the proceedings under the Recovery of Debts and Bankruptcy Act 1993/Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act were being taken, the proceedings before the Debt Recovery Tribunal (DRT) as well as the Debt Recovery Appellate Tribunal (DRAT), were already a subject matter of consideration before the Hon'ble Telangana High Court. The Ld. Adjudicating Authority while scrutinizing the propriety of the judgment referred to, as rendered in the matters of Bijnor Urban Co-Operative Bank Limited Vs. Meenal Agarwal & Others, which was relied by the Appellant, has answered the same by observing thereof, that there cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acknowledged the dues. 15. The Ld. Adjudicating Authority, observed that the application under Section 7 of the I & B Code, has been filed on 19.07.2020, and that is being argued to be well within the limitation, determining the same to be with effect from the compromise decree of 03.01.2020. The Ld. Adjudicating Authority considered the aforesaid aspect and ultimately observed, that default in the case of the proceeding has to be reckoned from the date when the financial creditor had actually got the knowledge of the default having been committed, which in the instant case will be falling to be 01.10.2012 when the notices under Section 13 (2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act was issued. 16. In order to substantiate the aforesaid observation, made by the Ld. Adjudicating Authority, the Ld. Adjudicating Authority has made reference to the Judgment of Asset Reconstruction Company Limited, which has held that, the declaration of a loan account/debt as a Non-Performing Asset (NPA) has to be taken as date of default. The said date has to be reckoned as the date of default in order to enable the financial c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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