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Judgment
ORDER
Per Balraj Joshi, Member (Technical)
The Court convened via hybrid mode.
Under consideration is an Application under section 95(1) of the Insolvency and Bankruptcy Code, 2016 (‘Code’), filed by Mr. Dasrath Pandurang Sadaye1, Chief Manager the Central Bank of India (‘Financial Creditor’) against Mr. Sushil Kumar Agarwal (‘Personal Guarantor’) of Concast Steel & Power Limited (In Liquidation) (‘Corporate Debtor’).
The Corporate Debtor was admitted into Corporate Insolvency Resolution Process (‘CIRP’) on 07 November, 2017 and Mr. Sanjay Agarwal was appointed as the Interim Resolution Professional (‘IRP’), however the IRP was replaced by Mr. Kshitiz Chhawchharia as the Resolution Professional (‘RP’). Since, no Resolution Plan was received by the RP, the Corporate Debtor was sent into liquidation vide order dated 26 September, 2018.
The Personal Guarantor had executed an Unattested Deed of Hypothecation dated 08 June, 2017, whereby he had hypothecated the securities including entire stocks, inventory, receivables, machineries, book debts and current and fixed assets and also equity share capital held by him. Further a Deed of Personal Guarantee dated 08 June, 2017 was also executed by the Personal Guarantor.
By executing such deeds, the Personal Guarantor undertook to meet the cash flow for the purpose of repayment of debt and its interest as accrued from time to time and to personally repay or redeem reconstructed loan facilities, in the event of default by the borrower i.e., the Corporate Debtor.Further, on failure of the Corporate Debtor to regularize the loan account, the account of the Corporate Debtor was declared as Non-Performing Assets in the year 2015.
To enforce its right under section 95 of the Code, the Financial Creditor initiated a proceeding against the Personal Guarantor. The Personal Guarantor, Mr. Sushil Kumar Agarwal was duly served by the Financial Creditor a statutory notice of demand dated 18 March, 2021 in terms of Section 95(4)(b); requesting him to make the payment of outstanding debt of Rs.280,93,10,825 as on 29 January, 2021. Despite, the receipt of the notice of Demand on 22 March, 2021, the Personal Guarantor did not made any payment.
In light of the above facts and circumstances, we, hereby, order as follows;
The interim moratorium in terms of sec 96(1)(a) of IBC, 2016 shall take effect from the date of application. i.e., 18 September, 2021
Ms. Rachana Agarwal, IBBI Registration No. IBBI/IPA-001/IP-P-02442/2021-2022/13732, Email: 08rkassociates@gmail.com is hereby appointed as the Resolution Professional in the matter. The RP is to file the Assignment Declaration within seven days from today with the Registry.
The Resolution Professional is directed to file his report in terms of Section 99 of the Code and the relevant Regulations.
A copy of the Report by the resolution professional under Section 99 to be filed, shall be forthwith provided to the petitioner and to the personal guarantor to the corporate debtor. Upon receipt thereof, they shall have two weeks within which to file their reply, if need be.
Liberty to file reply, if any, within two weeks from today.
List the matter on 27 June, 2021 for the perusal of the Report by the Resolution Professional and further proceedings.
A certified copy of this order may be issued, if applied for, upon compliance with all requisite formalities.
Footnotes
- 1.Power of Attorney dated 12 July, 2014.