Reliance Asset Reconstruction Company vs Bank Of Baroda & Anr

Reliance Asset Reconstruction Company Reliance centre, North Wing, 6th Floor, Off Western Express Highway, Santacruz East, Mumbai - 400 055 ...Applicant/Intervener

Vs.

1.Bank of Baroda Mount Road Branch No.1 Club House Road, Anna Salai, Chennai - 600 002 ...Appellant

2.Deepa VenkatRamani Resolution Professional, Office Address: Office No. 40, TNHB Complex, 180, Luz Church Road, Mylapore, Chennai - 600 004 ... Respondent

Present: For Applicant : Ms. Usha Singh with Mr. Akhilesh and Ms. Nidhi.S Advocates and Mr. Vipin Kumar Meena, Chief Manger (Legal)

For Appellant : Ms. Praveen Gautam with Ms. Sweety Pandey and Mr. Pawan Shukla, Advocates.

JUDGMENT

( 29th January, 2020)

Dr. Ashok Kumar Mishra, Technical Member

The Applicant/Intervener i.e. Reliance Asset Reconstruction Company has

filed a Review Application under Rule 11 of National Company Law Appellate

Tribunal Rules, 2016, by seeking the following reliefs:

a. Allow the present Review Application,

1 b. Modify the judgment dated 04.12.2019 to the extent as mentioned in the

aforegoing paragraphs and allow the submissions of the

Applicant/Intervener to be incorporated in the said judgment;

c. Stay the operation of impugned judgment 04.12.2019 during the pendency

of the present application.

d. Pass such other orders as this Hon'ble Appellate Tribunal may deem fit and

appropriate in the facts and circumstances of the present case and in the

light of justice, equity and good conscience.

2. The Applicant/Intervener seeking review/modification of the Judgment

dated 04.12.2019 passed by this Appellate Tribunal in Company Appeal (AT)

(Ins) No. 632 of 2019 that the Applicant/Intervener is holding 55.41 %

voting share in the Committee of Creditors ( 'for short CoC') and has

provided the following financial facilities to the Corporate Debtor from City

Union Bank (Assignor Bank of the Applicant/Intervener herein) during

October 2010 which are renewed thereafter from time to time.

i. Cash Credit of Rs. 22.50 Crore

ii. Ad hoc Limit of Rs. 5 Crore

iii. Term Loan of Rs. 1.50 Crore

iv. Bank Guarantee Limit of Rs. 18 Crore

That to secure the said credit facilities, the Corporate Debtor had

hypothecated all its current assets including receivables, stock and movables

vide Agreement of Loan cum Hypothecation dated 10.10.2011.

3. They have also submitted that this Appellate Tribunal has failed to consider

the submission, made by the Applicant/Intervener. They have filed its claim

before the Resolution Professional for an amount of Rs. 83,74,42, 818.56.

2 They have also cited the judgment of Mrs. Sonia Khosla Vs. Sameer Kudsia

& ors., Company Appeal (AT) No. 36 of 2016 along with Company Appeals

(AT) No. 43 to 47 of 2016 passed by this Appellate Tribunal wherein this

Appellate Tribunal has been pleased to allow review of orders.

4. The Appellant i.e. Bank of Baroda in Company Appeal (AT) (Insolvency) No.

632 of 2019 has preferred the Appeal under Section 61 (1) of the Insolvency

and Bankruptcy Code, 2016 ('for short I&BC, 2016) against the impugned

order dated 03.05.2019 passed by National Company Law Tribunal ('for

short Adjudicating Authority') Single Bench Chennai under Section 33 of the

I&BC, 2016 in MA /69/2019 in CP 233/IB/2017.The issue raised by the

Appellant i.e. Bank of Baroda in the said appeal that the direction given by

the Adjudicating Authority in terms of Impugned order dated 03.05.2019 to

the extent that the liquidator shall collect the amount of Rs. 5.95 Crores

plus interest accrued thereon from DRT-II Chennai for being dealt with

under provisions of Section 53 of the I&BC, 2016 is unsustainable, as the

Appellant - Bank of Baroda is a secured Creditor which has not relinquished

its security interest.

5. We have observed that the Applicant/Intervener has not been able to

establish its security interest advance towards the projects of Southern

Railway. It is also nowhere mentioned in the submission of the

Applicant/Intervener that they have furnished any security interest against

the project of the Southern Railways; even no documents have been

submitted to prove that the deposit by the Southern Railway pertains to any

receivables as security in connection with the loans or other financial

assistance had been advanced by the Applicant.

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6. The list submitted by the Resolution Professional in respect of projects

assigned to Bank of Baroda was available at Annexure A/4 page 66 in the

main Company Appeal and City Union Bank, the Applicant, has not

submitted any statement. Now, they have submitted a copy of the agreement

of loan cum Hypothecation dated 10.10.2011 in favour of City Union Bank

Ltd., as stated in Page No. 63 to 82 of the present Review Petition.

7. Presently, Company Appeal (AT) (Ins) No. 632 of 2019 has been remanded

back to the Adjudicating Authority to decide the security interest of the

Appellant Bank i.e. Bank of Baroda before the Liquidator can be given the

assets of the Corporate Debtor to be dealt with under Section 53 of the I&B

Code.

8. Hence, the Applicant/Intervener is also directed to approach the

Adjudicating Authority and provides the Terms Loan Agreement, Bank

Guarantee, Cash Credit & Ad hoc Limit facilities details etc., to the

Adjudicating Authority for appropriate adjudication to be dealt with in

accordance with Insolvency and Bankruptcy Code, 2016.

9. Thus, the Review Application is disposed of with the aforesaid directions &

observations. No order as to costs.

Justice Jarat Kumar Jain Member (Judicial)

Mr. Balvinder Singh Member(Technical)

Dr. Ashok Kumar Mishra Member (Technical)

New Delhi RK

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