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The Hyderabad Bench of the National Company Law Tribunal has permitted corporate insolvency proceedings against Ind-Bharat Energy (Utkal Limited), as per the provisions of the Insolvency and Bankruptcy Code, 2016 paving the way for resolution.
The Tribunal, while delivering its order on petitions filed by Bank of Baroda and Macquarie arm MAIF Investment India pte Limited, Singapore, to initiate insolvency proceedings and staking claims respectively, appointed Udayraj Patwardhan as the insolvency resolution professional.
The NCLT, while directing the matter for consideration under the Corporate Insolvency Resolution Process, declared a moratorium against institution of suits or continuation of pending suits against the corporate debtor and also execution of any judgment, decree or order. This will be applicable till the completion of the resolution process.
Bikki Ravindra Babu, Judicial member, in his order, stated that the petitioner bank was able to substantiate the existence of a debt and default in respect of the financial debt claimed by the bank. Citing the Supreme Court judgment in Innovative Industries versus ICICI Bank and Another, which observed, “The moment the adjudicating authority is satisfied that default has occurred, the application must be admitted unless it is incomplete,” and felt that it was fit for consideration.
According to the petitioner bank, the Ind-Bharat group arm defaulted in payment of ₹167 crore.
However, in the case of MAIF, which had converted a significant part of the debt into equity and moved the petition, the NCLT directed that the claims that it was making with regard to various payments, including interest, could be taken up with the Interim Resolution Professional.
The case of MAIF is interesting as it had moved the NCLT seeking dues even though it is a major shareholder in the power company. Due to delays in project implementation, the investment firm converted debt into equity and owns majority 99 per cent stake.
Indi-Bharat Energy Utkal, which has 713 MW in operation and 2,865 MW under implementation, had contended that since MAIF is the majority shareholder, it cannot initiate proceedings against the firm.
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