Mumbai: A bankruptcy court Wednesday admitted Jammu and Kashmir Bank’s application to initiate insolvency proceedings against Essel Infraprojects Ltd, a company promoted by media baron Subhash Chandra, over what the lender claimed was an ‘established case’ of default.
The Mumbai bench of the National Company Law Tribunal (NCLT), while admitting the company, has also appointed Hemant J Mehta as interim resolution professional (IRP). The private-sector lender had approached the tribunal after the Essel Group entity defaulted on its dues of ₹87.43 crore.
“The financial debt is due and payable by the corporate debtor (Essel Infraprojects) as on the date of filing the present company petition,” observed the division bench of judicial member Reeta Kohli and technical member Madhu Sinha in its order. “Further, there is admission of default and outstanding liability by the corporate debtor in various correspondences annexed to the company petition,” it added.
In this case, Jammu and Kashmir Bank had sanctioned a loan of ₹200 crore to Pan India Utilities Distribution Co in December 2013, of which ₹70 crore remains unpaid. Essel Infraprojects is a corporate guarantor of this loan. The lender said the company has not disputed the existence of the debt or the fact that it is in default.
Countering this, Essel Infraprojects argued that it entered into a scheme of demerger, where a specific asset (Gorai land parcel in the northern suburb of Mumbai) and its related project were transferred to Essel Urban Infraprojects Ltd. The rest of the company’s assets and business remained with the company.
