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In the matter of Navran Advanced Nano Products Development International Pvt. Ltd. rep. by Kumar Binit, Director

    No. (IB)-342 (ND) of 2017

    Decided On, 16 March 2018

    At, National Company Law Tribunal New Delhi


    For the Appearing Parties: Sanjay Bhatt, Juhi Bham Bhani, Yamini Khurana, Advocates.

Judgment Text

1. In the above application the Corporate Debtor is the Corporate Applicant seeking to invite upon Itself the Corporate Insolvency Resolution Process (CIRP) as contemplated under the provisions of Section 10 of the Insolvency and Bankruptcy Code, 2016 hereinafter called (IBC, 2016) read along with the rules namely Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 hereinafter called 'AAA' Rules and the relevant form prescribed there under namely Form 6 of the said rules. As per the said form and perusal of the contents therein, it discloses that the registered office of the company is presently located at B-3, Somedutt Chamber-I, 5 Bhikaji Cama Place, New Delhi-110066. As per list of dates and events filed alongwith the Petition, it is seen that the company was incorporated on 13.03.2008 and that it commenced Its business activities by manufacture of nano technology based products and that it is a supplier of printing chemical based on nano technology. It is further stated that the company is having identification number CIN:U28910DL2008PTC on the file of Registrar of Companies NCT of Delhi and Haryana (RoC). It is also stated that in the year 2017 the company has changed its registered office to the present location from N-59, G.K-I, New Delhi and in relation to the same a copy of Form 22 has been filed with the Roe annexed as Annexure A-I, evidencing the payment of relevant fees as well as Form INC-22 as specified under the Companies Act, 2013 intimating the change of registered office address. The names and addresses of all the Directors and promoters of the Corporate Debtor has been given as Annexure A-2, perusal of which discloses that the company is at present having 5 Directors and- in relation to the promoters group constituting 5 promoters. The share holding of the company has been given as Annexure A-3 wherein it is seen that the shareholders who are holding more than 5% of the shareholding in the Corporate Debtor includes Edelweiss Asset Reconstruction Company Ltd. a Financial Creditor. However, the share holding has not been prescribed in the said annexure, The chartered document of the company has been annexed as Annexure A-4 of the application as filed in Form-6. Perusal of the same discloses that the company is having a nominal share capital of Rs.4,00,00,000/- divided into 4000000 equity shares of Rs.10/- each and that the paid up share capital of the company at present is Rs.3,07,99,000/- divided into 3079900 shares of Rs.10/- each. The application further discloses that Mr. Kumar Binit, Director has been authorised vide Board Resolution dated 2.8.2017 to file petition before this Tribunal as Annexure A-5. In view of the fact that the losses of the company are to the tune of Rs.47,30,68,799/- and since there is no adequate demand for finished products and on account of cash flow constraints, the payments have been delayed to the creditors and statutory liabilities and hence default has arisen and in the circumstances the recommendation of the Board of Directors to initiate CIRP before this Tribunal.

2. Part-II of the application proposes the name of one Mr. Navneet Kumar Gupta having registration No.IBBI/IPA-001/IP-P00001/2016-17/10009 as the Interim Resolution Professional and that his consent has been enclosed as Annexure A-7 to the petition in Form No.2 of 'AAA' Rules, 2016. In relation to Part-III, the Corporate Debtor has given particulars of financial debt and it is seen that the Financial Creditor Edelweiss Asset Reconstruction Company Ltd. being the (assignee of State Bank of Patiala of its debts and securities). Further the list of unsecured creditors and sundry creditors is stated to have been detailed in Annexure A-8 (colly) to the petition and perusal of the same discloses that a sum of Rs.2,98,59,049.50 is due by way of unsecured loan and in relation to sundry creditors, a sum of Rs.1,18,78,693.70 is due from the Corporate Debtor as on 12.6.2017. In addition, Annexure A-9 has been annexed to the petition giving details of statutory dues outstanding as on 30th August, 2017 which also includes payments due towards Central Sales Tax, TDS, PF and Service Tax. The total number of employees employed with the Corporate Debtor on its roll has been listed in Annexure A-10 and perusal of the same shows that a total of 52 employees are on the roll of the Corporate Debtor and the gross salary payable is to the tune of Rs.12,04,778/-. Annexure A-11 annexed to the petition discloses the details of security created in favour of Financial Creditor i.e. Edelweiss Asset Reconstruction Company Ltd. as on 30.8.2017 which creation of security is also vouched by necessary registration of charge in favour of State Bank of Patlala and deed of assignment in favour of Edelweiss Asset Reconstruction Company Ltd.

3. The proof for establishing that there has been default in payment of debt on the part of the Corporate Debtor has been annexed as Annexure A-17 of the typed set of documents which contains a copy of notice issued by State Bank of Patiala, both to the Corporate Applicant as well as to the guarantor, recalling the loan in a sum of Rs.35,84,03,085/- as on 13.12.2014 and perusal of the same shows that 3 guarantors have been named there in all of whom are Directors of the company as well the list of assets which have been secured in the documents executed by the Corporate Debtor as well as guarantors has been detailed in the respective schedules given In the said notice dated 10.01.2015 issued by State Bank of Patiala. Annexure A-18 annexed to the petition discloses assignment of financial assistance to Edelweiss Asset Reconstruction Company Ltd. by State Bank of Patiala dated 26.05.2015 which assignment is not resisted by the Corporate Debtor herein. By way of Annexure A-20, the Corporate Debtor seeks to bring to the notice of this Tribunal the sale of security being the property situated at Unit No.G-10-B, Ground Floor, Cyber Park Complex, Park Central Village Silokhera, Sector 30; Gurgaon, Haryana to the extent measuring 1695.40 sq. ft. and the appropriation of proceeds there under by Edelweiss Asset Reconstruction Company Ltd. towards the financial debt owed. However; this Tribunal is restraining from making any observations in relation to the same and the IRP appointed will, as per the provisions of IBC, 2016 consider the said transaction. Again the recall letter issued by Edelweiss Asset Reconstruction Company Ltd. subsequent to assignment on 20.3.2017 annexed as Annexure A-22 being given to the Corporate Debtor as well to the personal guarantors who have stood as surety for the company as listed above has been enclosed and the same has been issued pursuant to Section 13 of Securitization And Reconstruction of Financial Asset and Enforcement of Security Interest Act, 2002 and the default amount is stated to be Rs.49,15,93,556/- payable as on 28.02.2017. The recall letter also contains Schedule of immovable property mortgaged/charged and hypothecated assets of movables and also accompanying the break-up of the total claim or total dues owed to Edelweiss Asset Reconstruction Company Limited as Schedule-III to the said notice.

4. In view of the above said disclosures and as is the practice of this Tribunal, a notice was directed to be given to the Financial Creditor namely Edelweiss Asset Reconstruction Company Limited vide order dated 13.9.2017 and seven days time was also granted to the Corporate Applicant being the Corporate Debtor to further comply with the provisions of IBC, 2016 and the attendant rules. Pursuant to the service of notice as is evident by order dated 5.10.2017 passed by this Tribunal, Financial Creditor upon notice was present and it was represented by Ld. Counsel for Financial Creditor that one of the property listed at Page-62 of the typed set of the documents filed along with the petition, has been sold and in the circumstances, the Petitioner company namely the Corporate Debtor may be allowed to amend the Petition accordingly. On the said date it was represented that the property was sold upon the consent of the Financial Creditor namely Edelweiss Asset Reconstruction Company Limited having charge over the property. Upon suitable amendment of the Petition the same has been filed by the Petitioner. The estimated value of assets as directed to be filed by the Corporate Debtor, it is represented by Ld. Counsel for Petitioner has also been complied with.

5. As already stated, this Petition has been filed by the Corporate Applicant under Section 10 of IBC, 2016 for initiating the CIRP process. While delineating the scope and powers of this Tribunal, being the adjudicating authority in relation to CIRP under Section 10, of IBC, 2016 the Hon’ble NCIAT in the matter of M/s Re: Unigreen Global Private Ltd. in Company Appeal (AT) (Insolvency) No.81 of 2017, has held to the following effect:

Section 10 does not empower the Adjudicating Authority to go beyond the records as prescribed under Section 10 and the informations as required to be submitted in Form 6 of the Insolvency and Bankruptcy (Application to the Adjudicating Authority) Rules, 2016 subject to Ineligibility prescribed under Section 11. If all informations are provided by an applicant as required under Section 10 and Form 6 and if the Corporate Applicant is otherwise not ineligible under Section 111 the Adjudicating Authority is bound to admit the application and cannot reject the application on any other ground.

6. In view of the judgement of Hon’ble NCLAT as stated above, the Petitioner was directed to file a co-relation statement to the effect that the documents filed along with the Petition and the documents as specified in the annexure to Form-6, prescribed under 'AAA' Rules, 2016 have been filed and pursuant to the same the Petitioner has filed vide diary No. 315 dated 19.1.2018 a co-relation statement co-relating annexures as specified in the prescribed form and the documents filed along with this Application wherein it has been demonstrated by Petitioner as to how it has complied with all the details, as are required to be specified in Form 6 and the documents as are to be enclosed as listed vide annexure to Form 6. In addition, Petitioner has also filed vide Diary No. 315 dated 19.1.2018 the master data pertaining to the Corporate Debtor as well as the certificate of registration of the Interim Resolution Professional named in the application being Mr. Navneet Kumar Gupta being registration No. IBBI/IPA-001/IP- P00001/2016-17/10009. Thus going by the above decision of Hon’ble NCLAT from the facts narrated above, it is also evident that the Financial Creditor has not come forward with any objection in relation to the CIRP being initiated against the Corporate Applicant namely Corporate Debtor. Further, it has been stated by the Corporate Applicant by way of affidavit dated 30.11.2017 filed on its behalf by one of its director that the Corporate Applicant is not disentitled from filing an application to initiate CIRP under Section 11 of IBC, 2016.

7. It is also seen that subsequent to the filing of the Petition on 8.01.2018 vide diary No. 2980 under the directions of this Tribunal, a detailed list of Creditors classified into Secured Creditors, Unsecured loan as well as duties and taxes payable to the Government and provision to be made in relation to employee welfare and Sundry Creditors have been filed as on 30.8.2017 which is within the period of 14 days from the date of filing of this Petition as prescribed under 'AAA' Rules, 2016. Further, books of accounts/ledgers concerning the Creditors for the year 2016 and 2017 and from April, 2017 to August, 2017 co-relating with the balance as disclosed in the certificate issued by the Chartered Account, as stated above, has been filed vide diary No. 683 dated 8.2.2018 under the directions of this Tribunal. Further, on the said day the statement of affairs In compliance with the order dated 24.01.2018 has also been filed vide above diary No. being 683 dated 8.2.2018, as required to be furnished under IBC, 2016 read with 'AAA' Rules, 2016. This Tribunal has perused the documents as filed and detailed above in paragraph supra and it is seen that the Corporate Debtor being the Corporate Applicant owes money to the Financial creditor and Operational Creditors including the statutory dues to the Government and default has been committed in relation to financial debt owed to Edelweiss Asset Reconstruction Company Limited which is evident from notice under Section 13(2) of securitization And Reconstruction of Financial Asset and Enforcement of Security Interest (SARFAESI) as well as proceeding having been filed against the Corporate Debtor in OA No.2736 of 2017 before the Debt Recovery Tribunal, Chandigarh claiming a sum of Rs.49,15,93,556/- under the said OA, as evidenced by a copy of the summons issued by DRT which has been annexed as Annexure A-26 dated 3.8.2017 which clearly evidences the default of the debt due to the Financial Creditor. The Financial Creditor as is evident also vouched for the default committed by the Corporate Debtor. Taking into consideration that debts are owed by the Corporate Applicant being the Corporate Debtor to its Creditors as well as default has arisen in relation to the same and there being no objection from Financial Creditor in relation to initiation of CIRP process as against the Corporate Debtor, this Petition is admitted as prayed for.

1. The corporate insolvency resolution process shall commence from the date of this order under sub-section (5) of section 10 of the Code.

2. A moratorium in terms of section 14 of the Code is being issued including the following:

* institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgment, decree or order in any court of law, tribunal, arbitration panel or other authority;

* transferring, encumbering, alienating or disposing of by the corporate debtor any of its assets or any legal right or beneficial interest therein;

* any action to foreclose,

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recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002; * recovery of any property by ah owner or lessor where such property is occupied by or in the possession of the corporate debtor. * that supply of essential goods or services to the Corporate Debtor, if continuing, shall not be terminated or suspended or interrupted during the moratorium period. * the order of moratorium shall have effect from the date of this order till the completion of the corporate insolvency resolution process as per Sub- Section (4) of section 14 of the Code read with Section 31 of IBC, 2016. 3. Mr. Navneet Kumar Gupta is appointed as Interim Resolution Professional, who shall take necessary steps as envisaged under section 15, 17 and 18 of the Code. Since, the tenure of the IRP under section 16(5) shall not exceed 30 days from the date of his appointment, the IRP is directed to submit his initial report at the earliest detailing the steps taken by him pursuant to the Petition being admitted as well as for calling and convening the 1st meeting of Committee of Creditors as envisaged under IBC, 2016. In terms of section 17 of the code, the Board of the Corporate Debtor shall stand suspended. Let the copy of the order be supplied to the Corporate Applicant and the Financial Creditor as well as the Interim Resolution Professional appointed hereinabove.