On ICICI Bank petition, NCLT orders insolvency process against Marg

T E Raja Simhan | | Updated on: Jun 03, 2019

The National Company Law Tribunal (NCLT), Chennai, has appointed an Interim Resolution Professional under the Insolvency and Bankruptcy Code in a case relating to Marg Ltd for the Karaikal port project.

The Division Bench of BSV Prakash Kumar, Member (Judicial), and S Vijayaraghavan, Member (Technical), was hearing a petition on Marg defaulting in repaying an amount of ₹71.69 crore due and payable as on April 24, 2018.

ICICI Bank had sanctioned a Rupee Term Facility of ₹165 crore on the execution of a Credit Agreement Letter (CAL) in December 2009 to enable Marg finance up to 50 per cent contribution in the business plan to establish Karaikal Port Pvt Ltd in Puducherry by equity participation and capital expenditure.

The Rupee Term Facility was changed at the company’s request through a CAL in April 2010 wherein the purpose of the facility was to enable the company to finance up to 50 per cent contribution to establish the port and a New Chennai Township Pvt Ltd. Again, in June 2010, a revised CAL was issued making amendments to the earlier CAL, and a term loan was utilised by Marg with repayment to be made in 21 equated quarterly instalments from July 2011.

However, the company failed to repay as agreed and the bank initiated Debt Recovery Tribunal (DRT) proceedings. The DRT-II, Chennai, issued a Debt Recovery Certificate in favour of the bank for ₹71.69 crore from Marg.

As ICICI Bank has proved the existence of debt and default against the company by showing various documents and certificate issued by the DRT-II, the NCLT Bench admitted the company petition by appointing Vasudevan as the Interim Resolution Profession.

Published on June 03, 2019
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