The interim resolution professional appointed by the Kolkata bench of National Company Law Tribunal (NCLT) has, so far, admitted claims to the tune of around ₹1,800 crore from creditors, both financial and operational, of Birla Tyres Ltd. The process of verification is still on and the claims are likely to be “much more” than the amount currently admitted, said a source close to the resolution process.
The Kolkata bench of NCLT had initiated insolvency proceedings against Birla Tyres, a BK Birla group company, based on a petition filed by one of its operational creditors SRF Ltd.
It had further appointed Seikh Abdul Salam as interim resolution professional (IRP) of the corporate debtor to carry out the functions as per the Code.
SRF had claimed a default in payment of ₹15.84 crore, which includes a principal of ₹10.06 crore and interest of ₹5.78 crore, for the supply of Tyre Cord Fabric as of July 8, 2021.
Claims from financial creditors which includes State Bank of India, ICICI Bank, WBIDFC, Asset Reconstruction Company (India) Ltd, DBS Bank India Ltd, Yes Bank and Punjab National Bank among others, amount to close to ₹1,200 crore so far.
The two-member bench comprising of Harish Chander Suri, Member (Technical) and Rohit Kapoor, Member (Judicial) also slammed the BK Birla group firm for taking a “very casual attempt” to seek adjournments in the matter.
In this matter, the NCLT had issued notice to Birla Tyres on October 20, 2021, over SRF’s plea. On December 22, 2021, the company sought some time to file a reply and sought adjournment. Again on February 28, 2022, it sought some more time and, accordingly, NCLT granted two more weeks to file the reply affidavit and the matter was directed to be listed on April 5, 2022.
On April 5, at the next hearing, Birla Tyres again sought further extension on the pretext of some disruptions at its factory premise. “In view of the facts and circumstances based on record, we are of the considered opinion that it was a very casual attempt made by the Corporate Debtor to seek further adjournment for the 4th time consecutively since October, 2021 and reference to agitation by workers and families in September, 2021 was merely an attempt to prolong the proceedings. Keeping in view, this matter under IBC, 2016 wherein the very object of the Code is to finalise the insolvency proceedings in a time-bound manner for maximization of value of assets, granting adjournment after another and that too without any basis cannot be permitted by this Adjudicating Authority and thus declined to further extend the time for filling reply affidavit by Corporate Debtor,” it said.
The company, meanwhile, convened the fourth annual general meeting here on Saturday.