State Bank Of India vs Cable Corporation Of India

NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI Company Appeal (AT) (Insolvency) No.1174 of 2023 (Arising out of Order dated 18.07.2023 passed by the Adjudicating Authority (National Company Law Tribunal), Mumbai Bench-IV in C.P.(IB)/361(MB)/2021)

IN THE MATTER OF: State Bank of India A body corporate constituted under the State Bank of India Act, 1955, having corporate Office at State Bank Bhavan, Madame Cama Road, Nariman Point, Mumbai, Maharashtra - 400021 Branch: Stressed Assets Resolution Group Commercial-III Branch, 112-115, 1st Floor Tulsiani Chambers, Free Press Journal Marg Nariman Point, Mumbai -400021 ... Appellant Versus

Cable Corporation of India Limited Having its registered office at Laxmi Building, 6 Shoorji Vallabhdas Marg Ballard Estate, Mumbai, Maharashtra-400001 ... Respondent

Present: For Appellant: Mr. Krishnendu Datta, Sr. Advocate with Mr. Prateek Kumar, Ms. Raveena Rai, Ms. Apeksha Dhananjay, Advocates. For Respondents: Mr. Abhijeet Sinha, Sr. Advocate with Mr. Arjun Krishnan, Ms. Savni, Mr. Kaustav Som, Mr. Lalit Munshi, Mr. Warisha, Mr. Arpit Dahoti, Ms. Palak, Ms. Siddhi, Mr. Saikat Sarkar, Advocates for R1 Mr. Nankani, Sr. Advocate with Mr. Shlok Das, Mr. Pranav Sarthi, Mr. Gaurav Vutts, Mr. Satchi Bhosls, Ms. Rema Deasi, Ms. Jyotika Raichandani, Advocates for R2 Mr. Satchit Bhogle, Advocate for intervenor.

JUDGMENT

ASHOK BHUSHAN, J.

This Appeal by a Financial Creditor has been filed challenging the

order dated 18.07.2023 passed by National Company Law Tribunal,

Company Appeal (AT) (Insolvency) No.1174 of 2023 1 Mumbai Bench-IV rejecting Section 7 Application filed by the Appellant.

The Appellant aggrieved by the rejection of Section 7 Application has come

up in this Appeal.

2. Brief facts of the case necessary to be noticed for deciding the Appeal

are:

(i) The Appellant extended various financial facilities to the

Respondent - Cable Corporation of India Limited. Default was

committed by the Corporate Debtor in servicing the financial

debt. Account of the Corporate Debtor became irregular on

06.06.2019 and was classified as Non-Performing Asset

("NPA") on 04.09.2019.

(ii) Section 7 Application was filed by the Appellant on 12.03.2021

claiming default of an amount of Rs.58,44,90,194/- as on

01.03.2021. Notices were issued by the Adjudicating Authority

in response to which reply was filed by the Corporate Debtor.

(iii) During the pendency of Section 7 Application, a settlement was

arrived at between the parties. The State Bank of India ("SBI")

vide letter dated 27.09.2021 accepted the offer of settlement of

dues on payment of Rs.47.47 crores along with de-risking of

live Performance Bank Guarantees ("PBG") aggregating to

Rs.30.40 crores. Twenty five percent of the compromise

amount, i.e. Rs.11.86 crores was to be paid within three

working days of the Sanction Letter. Seventy five percent of

compromise amount was to be paid within 90 days of the

Company Appeal (AT) (Insolvency) No.1174 of 2023 2 acceptance of the Sanction Letter. The Corporate Debtor also

had to arrange for de-risking of all live bank guarantee

outstanding with Counter Bank Guarantees ("CBG") of other

1st Class Bank acceptable to the Appellant or 100% cash

margin for the outstanding live bank guarantee within 90 days

of the Sanction Letter.

(iv) In pursuance of Sanction Letter dated 27.09.2021, the

Corporate Debtor deposited the amount. After Adjudicating

Authority granted extension of time for depositing of Rs.47.47

crores, on 01.06.2022 when the case was taken before the

Adjudicating Authority, the Financial Creditor made a

statement that Corporate Debtor has made the payment of

balance amount of Rs.7.47 crores and additional interest of

Rs.63 lakhs has also been made by cheque. The Adjudicating

Authority vide order dated 01.06.2022, extended the time for

replacement of the Bank Guarantees till 30.06.2022.

(v) There were correspondence between the parties with regard to

CBG. Certain issue was raised by the Corporate Debtor

regarding the live Bank Guarantees. By letter dated

29.06.2022, the Corporate Debtor wrote to the Financial

Creditor informing that Corporate Debtor through its banker,

i.e., ICICI Bank issued CBG for 13 guarantees aggregating to

Rs.7.26 crores. The SBI pointed out discrepancies in the

format of CBG and asked the Corporate Debtor to modify the

Company Appeal (AT) (Insolvency) No.1174 of 2023 3 CBG. Accordingly on 30.06.2022, the Corporate Debtor

forwarded 12 soft copies of the CBG to SBI. The SBI issued a

letter dated 01.07.2022 communicating that hard copies of the

Bank Guarantees ("BG") sent by Corporate Debtor on

30.06.2022 were in different format from the Bank's specified

format, which is not acceptable. The SBI informed the

Corporate Debtor that BGs having not been submitted till

30.06.2023, the Bank is constrained to treat the compromise

as failed. There was further discussion and exchange of

correspondence in relation to format of PBGs between the

parties.

(vi) On 19.04.2023 SBI wrote to Corporate Debtor refusing to

accept the CBGs, however, confirmed that BGs stood reduced

to Rs.8.63 crores. On 15.06.2023, Corporate Debtor sent a

letter offering deposit of 100% cash margin against the total

outstanding BGs, amounting to Rs.8.63 crores. The Corporate

Debtor also shared fixed deposit receipt for an amount of

Rs.8.65 crores with SBI. On 16.06.2023 the SBI sent a letter

to Corporate Debtor rejecting Corporate Debtor's offer. The SBI

informed the Corporate Debtor that if it intends to amicably

resolve the matter, it may submit a fresh compromise proposal

for both fund-based cash credit and non-fund based BG

amount. The Corporate Debtor once again offered 100% cash

Company Appeal (AT) (Insolvency) No.1174 of 2023 4 deposit by letter dated 27.06.2023, which was rejected by the

SBI.

(vii) The Adjudicating Authority heard the parties and by order

dated 18.07.2023, dismissed Section 7 Application filed by the

SBI. The Adjudicating Authority held that Corporate Debtor

having paid entire settlement amount of Rs.47.47 crores, no

debt was due and the Bank Guarantee cannot qualify as a

'debt'. It was further noticed by the Adjudicating Authority

that Corporate Debtor has offered de-risking of BGs by deposit

of 100% cash margin in the form of fixed deposit, subject to

release of securities by the Financial Creditor. The

Adjudicating Authority found bonafide efforts on behalf of the

Corporate Debtor in de-risking by deposit of 100% cash margin

and by recording the aforesaid findings, the Adjudicating

Authority dismissed Section 7 Application. The Appellant

aggrieved by the said order has filed this Appeal.

3. The Appeal was adjourned on several occasions on the request of the

Appellant that it is taking steps to resolve the matter. An additional affidavit

has also been filed by the Appellant, bringing on record subsequent letters

and correspondences exchanged between the parties. In the additional

affidavit, letter dated 13.12.2023, containing the fresh settlement between

the parties with regard to live BGs amounting to Rs.7.85 crores was also

brought on record.

Company Appeal (AT) (Insolvency) No.1174 of 2023 5

4. We have heard Shri Krishnendu Datta, learned Senior Counsel

appearing for the Appellant and Shri Abhijeet Sinha, learned Senior

Counsel appearing for Respondent.

5. Learned Senior Counsel for the Appellant submits that Sanction

Letter dated 27.09.2021 contained both the stipulation, i.e., payment of

Rs.47.47 crores as well as de-risking of live BGs of Rs.30.40 crores.

Although, the Corporate Debtor has made the payment of Rs.47.47 crores,

but outstanding live BGs have not been de-risked within the time allowed.

The Bank has already communicated to the Corporate Debtor by letter

dated 01.07.2022 that compromise has failed. The Bank is, thus, entitled

to recover the entire amount from the Corporate Debtor, i.e., Rs.77.87

crores as on 31.08.2021. It is submitted that Adjudicating Authority itself

in its various orders dated 26.05.2022 and 01.06.2022 has noted that in

event BGs are not de-risked within the time allowed, the Adjudicating

Authority shall have no option except admitting Section 7 Application. The

Adjudicating Authority committed error in rejecting Section 7 Application.

It is submitted that after filing of the Appeal, the Bank approved the

compromise proposal on submission of 100% cash margin or by way of

CBGs amounting to Rs.7.85 crores vide its letter dated 13.12.2023. In

response to which, Corporate Debtor has not fulfilled the conditions of

settlement. The Corporate Debtor having failed to de-risk the live BG,

Section 7 Application filed by the Appellant deserves to be admitted.

6. Shri Abhijeet Sinha, learned Senior Counsel appearing for the

Respondent submits that as per settlement dated 27.09.2021, the entire

Company Appeal (AT) (Insolvency) No.1174 of 2023 6 amount of Rs.47.47 crores has been paid by the Corporate Debtor within

the time as extended by Adjudicating Authority. Thus, entire amount

having been paid, no debt is left for which Section 7 Application could be

admitted. It is submitted that insofar as de-risking of the BGs is concerned,

as per the SBI on the date when order was passed by the Adjudicating

Authority total live BGs as on date was for Rs.8.63 crores. The Corporate

Debtor has forwarded the CBG from ICICI Bank, which was not accepted

by SBI on the ground that it is not in required format. The attempt of

Financial Creditor was to somehow refuse to accept the efforts made by the

Corporate Debtor. It is submitted that the Adjudicating Authority has

rightly taken the view that Bank Guarantees having not been invoked, there

was no debt for which Section 7 Application could have been proceeded

with. The Adjudicating Authority has rightly noted the bonafide efforts

made by the Corporate Debtor in de-risking the live BG, which could not

be fructified due to obstructive attitude adopted by the Appellant. The

Appellant has been using the IBC proceedings for recovery, even when

entire settlement amount of Rs.47.47 crores has been paid. Even the Bank

also accepted the fresh compromise by letter dated 13.12.2023 in response

to which the Corporate Debtor made all efforts to submit CBG through the

Kotak Mahindra Bank/ ICICI Bank, which was not accepted on the ground

that period of one month allowed by letter dated 13.12.2023 has elapsed,

whereas the Corporate Debtor has requested for time. It is further

submitted that after the aforesaid letter cash margin amounting to Rs.3.38

crores was paid, thereby reducing the values of Bank Guarantees to be de-

Company Appeal (AT) (Insolvency) No.1174 of 2023 7 risked to Rs.4.27 crores. It is further submitted that two BGs have come

to an end and expired on 11.04.2024 and as on date the live BGs are only

of Rs.3.68 crores. The Corporate Debtor has always expressed its

willingness to deposit 100% cash margin or by CBG, which due to one or

other reason has not been accepted by the SBI. The Corporate Debtor has

requested the SBI to issue No Due Certificate and also to release all

charges, securities and guarantees with respect to the facilities sanctioned

by handing over all original security documents, which was not accepted

by the SBI. On 12.04.2024, the SBI again wrote to the Corporate Debtor

that compromise has failed by referring to earlier letter sent by the

Corporate Debtor. It is submitted that SBI is using IBC proceedings for

other than insolvency of resolution of Corporate Debtor, which is not

permissible as per the object and purpose of the enactment. The

Adjudicating Authority did not commit any error in rejecting Section 7

Application.

7. We have considered the submissions of learned Counsel for the

parties and have perused the records.

8. Section 7 Application was filed by the Appellant for an amount of

Rs.58,44,90,194/- as on 01.03.2021 and date of default was mentioned as

06.06.2019 and date of NPA as 05.09.2019. Part-IV of Section 7

Application at Item-2 provides as follows:

"2. AMOUNT CLAIMED TO BE INR 58,44,90,194 (Rupees IN DEFAULT AND THE Fifty Eight Crore Forty Four Lakh Ninety Thousand One

Company Appeal (AT) (Insolvency) No.1174 of 2023 8 DATE ON WHICH THE Hundred and Ninety Four DEFAULT OCCURRED as on 10.03.2021) Date of default:

The account of the Corporate Debtor became irregular on 6 June 2019 (due to repayment default) and was classified as NPA on 5 September 2019"

9. It is to be noted that the SBI issued a Sanction Letter dated

27.09.2021 accepting the Compromise Settlement for amount of Rs.47.47

crores along with de-risking of entire live BGs outstanding of Rs.30.40

crores. The Sanction Letter, thus, provided for both the conditions, i.e.

payment of Rs.47.47 crores and de-risking of live BGs of Rs.30.40 crores.

The Sanction Letter further provided that, if the compromise amount or the

de-risking of the BGs is not received within the stipulated period, the Bank

reserve the right to cancel the compromise.

10. Insofar as payment of Rs.47.47 crores, which was the settlement

amount, there is no dispute between the parties that the said amount stood

paid by 01.06.2022, i.e., within the time extended by Adjudicating

Authority. In the order passed by the Adjudicating Authority on

01.06.2022, the Adjudicating Authority has noticed the submission of

Financial Creditor. The order dated 01.06.2022 is as follows:

Company Appeal (AT) (Insolvency) No.1174 of 2023 9 "1. Mr. Gaurav Joshi, Ld. Sr. Counsel for the Financial Creditor present. Mr. Ashish S. Kamat a/w Mr. Rashmin Khandekar, Ld. Counsel for the Corporate Debtor present.

2. This matter was listed in vacation Bench on 26.05.2022 wherein the Bench ordered the payment of the balance amount of Rs.7.47 crore latest by 31.05.2022 and for replacement of Bank Guarantees, a time up to 30.06.2022 has been allowed.

3. Counsel for the Financial Creditor confirms that the payment of Rs.7.47 crore has been made by the Corporate Debtor to the Financial Creditor before 31.05.2022 in compliance of the orders of this Bench. However, additional interest of about Rs.63 lakh has been made by the Corporate Debtor today morning by way of current date cheques. The Corporate Debtor will ensure that cheques of Rs. 63 lakh (Approx.) are cleared on presentation by the Financial Creditor. As the time is allowed up to 30.06.2022 for replacement of the Bank Guarantees, post this matter for further consideration on 04.07.2022.

4. It is made clear that no further extension on any account will be allowed to the Corporate Debtor for replacement of the Bank Guarantees and in case the Corporate Debtor fails in replacement of the Bank Guarantees to the satisfaction of the Financial Creditor, the Corporate Debtor will be admitted into CIRP."

11. By order dated 01.06.2022, the Adjudicating Authority granted time

to the Corporate Debtor till 30.06.2022 to de-risk the live BGs. The

Adjudicating Authority in the impugned order noted that the Corporate

Debtor had provided 13 CBGs issued by ICICI Bank, amounting to Rs.7.26

crores as against total outstanding of Rs.15.63 crores as on 30.06.2022,

which came to be rejected on account of certain clause(s). The Corporate

Debtor again intimated the Financial Creditor on 27.09.2022 that ICICI

Company Appeal (AT) (Insolvency) No.1174 of 2023 10 Bank has transmitted CBGs amounting to Rs.15,62,64,943/-, the

outstanding as on that date, but the Financial Creditor refused to accept

the same on the ground that the settlement has failed on 30.06.2022. The

Corporate Debtor has also filed an IA No.1798 of 2022 seeking further

extension of time to submit CBGs or replace the live PBGs by providing

100% cash margin towards live PBGs. The Adjudicating Authority has

returned the finding that as on 30.06.2022, the whole settlement amount

was paid. It has been further noticed by the Adjudicating Authority that

the BG, which was required to be de-risked have reduced from Rs.30.40

crores to Rs.8.63 crores, on account of expiry/ withdrawal of some PBGs.

It is useful to note paragraph 6.3.1, 6.3.2, 6.3.3 and 6.3.4 of the order of

the Adjudicating Authority, which is as follows:

"6.3.1. Per Contra, the Corporate Debtor has pleaded before this Bench, that whole of settlement amount of Rs. 47.47 Crores was paid within the period, extended by this Tribunal from time to time alongwith additional interest of INR 64 Lakh. Further, the non-compliance to settlement terms in the form of failure to de-risk the outstanding PBGs, which stood at INR15.63 crores as on 30.6.2022, was not attributable to the default on the part of the Corporate Debtor. Instead, the said failure occurred because of obstinate attitude of the Financial Creditor. It was also submitted that there has been no prejudice caused to the Financial Creditor due to the delay, if any, and on the contrary, the bank guarantee exposure of Financial Creditor has reduced substantially and non-release of securities, indirectly, de-risked such exposure. This is because, since the execution of the Sanction Letter, the value of the Bank Guarantees that needed to be de-risked have reduced from INR 30.40 Crore to INR 8.63 Crore, on account of expiry/withdrawal of some of PBGs. Our attention was also

Company Appeal (AT) (Insolvency) No.1174 of 2023 11 drawn to one instance, where one of the Guarantee was invoked and the Corporate Debtor deposited the amount becoming payable on such invocation with the Financial Creditor within the permissible period, in accordance with the conditions of clause VII of the sanction letter.

6.3.2. The Financial Creditor drew our attention to Order dated 31.03.2022 & 26.05.2022 to contend that the said order(s) had categorically stated that, in the event of Corporate Debtor failing to de-risk the outstanding PBGs by 30.6.2022, it shall be admitted to CIRP as there exists debt, which is in default.

6.3.3. This Bench finds that, as on 30.6.2022, the whole of settlement amount was paid with the settlement period, as extended by this Tribunal from time to time, as well as the additional interest of Rs. 64 lacs in accordance with the terms of settlement sanction clause IX of the other conditions directions of this Tribunal to compensate the Financial Creditor for loss of interest because of extended period.

6.3.4. In relation to de-risking of outstanding PBGs as on 30.6.2022, which were also required to de-risked by that date to make the settlement effective, this Bench finds that the Corporate Debtor had offered to provide counter-guarantee from ICICI Bank & Kotak Mahindra Bank, subject to the Financial Creditor clarifying whether it would release its security upon submission thereof. This Bench finds that the Financial Creditor, though dis-satisfied with the extension order(s) passed by this Bench, did not file an appeal against those orders. Accordingly, these extension orders, having attained finality at relevant point, extended the period of settlement, which any person of ordinary prudence will be made to believe. This Bench finds that the Corporate Debtor still holds the securities, and the same have not been released, thereby securing the outstanding PBGs sufficiently, which has the effect of de-risking the same."

Company Appeal (AT) (Insolvency) No.1174 of 2023 12

12. The Adjudicating Authority further has posed the question "whether

a live guarantee constitute debt; and if yes, whether it can be said that a

default can exist in such case". The Adjudicating Authority answered the

said question by holding that BGs having not been invoked, it is not a debt.

It was held that even assuming that there is any failure on the part of

Corporate Debtor to de-risk Financial Creditor's live guarantees, such a

failure is not a failure to repay a debt and does not give rise to a default

within the meaning of the IBC. Further, in paragraphs 6.4.5 and 6.4.6,

following have been held:

"6.4.5. In the case of Swiss Ribbons Pvt. Ltd. & Anr vs. Union of India & Ors. {Writ Petition (Civil) No. 99 OF 2018}, it was held that "It can thus be seen that the primary focus of the legislation is to ensure revival and continuation of the corporate debtor by protecting the corporate debtor from its own management and from a corporate death by liquidation. The Code is thus a beneficial legislation which puts the corporate debtor back on its feet, not being a mere recovery legislation for creditors".

6.4.6. In the case of Anita Jindal Vs. M/s Jindal Buildtech Pvt.

Ltd. through The IRP (2022) ibclaw.in 564 NCLAT 14, it was held that "The Preamble of IBC is carefully worded to describe the spirit and objective of the Code to be 'Reorganisation' and 'Insolvency Resolution', specifically omitting the word 'Recovery'. The Parliament has made a conscious effort to ensure that there is a significant difference between 'Resolution' and 'Recovery'. The Hon'ble Supreme Court has time and again observed that the fundamental intent of IBC is 'maximising the value of assets' in the process of 'Resolution'. In 'Mobilox Innovations Private Limited' Vs. 'Kirusa Software Private Limited', (2018) 1 SCC 353, the Hon'ble Apex Court has examined in detail the United Nations

Company Appeal (AT) (Insolvency) No.1174 of 2023 13 Legislative Guide on Insolvency, in which the IBC finds its roots. Any Application to commence CIRP can be denied when the Creditor is using Insolvency as an inappropriate substitute for Debt Recovery Procedures. If IBC is purely used for the purpose of Debt Recovery, particularly when the amounts due are small, and the Company is a solvent entity and is a going concern, the question of 'Reorganising' or 'Resolution of the Company' does not arise. This Tribunal in 'Binani Industries Limited' Vs. 'Bank of Baroda & Anr.', Company Appeal (AT) (Ins.) No. 82 of 2018, has differentiated between 'Recovery' and 'Resolution' and has observed that IBC is not a Recovery Proceeding. 'Recovery' dispossesses the 'Corporate Debtor' of its assets while a Resolution is an effort to keep it afloat"."

13. The Adjudicating Authority noticed that entire settlement amount

having been paid, has rightly taken the view that there is no debt due on

which Section 7 Application can be admitted. The Adjudicating Authority

found that the live BGs of Rs.30.40 crores, which was required to be de-

risked as per settlement dated 27.09.2021, had reduced to Rs.8.63 crores

at the time of consideration of the Application and the Adjudicating

Authority has noted that the Corporate Debtor had offered to provide

counter-guarantee from ICICI Bank, which due to one or the other reasons

was not accepted by the Financial Creditor. The Adjudicating Authority

has rightly taken the view that due to non-invocation of BGs, no debt had

become due and the Financial Creditor, could not insist for admission of

Section 7 Application. More so, when Corporate Debtor has offered to

deposit 100% cash margin or give CBG and CBG from the ICICI Bank were

transferred, which were not accepted by the Financial Creditor. The

Company Appeal (AT) (Insolvency) No.1174 of 2023 14 Financial Creditor has been taking the stand that since CBGs were not

given within the time allowed as per settlement and even the order dated

01.06.2022 of the Adjudicating Authority noted that the settlement has

failed and Financial Creditor is entitled to recover the entire dues from the

Corporate Debtor. As noted above, insofar as settlement amount is

concerned, there is no dispute that entire settlement amount of Rs.47.47

crores was paid within the time allowed. Only issue left is with regard to

de-risking of live BGs. Live BGs, which were to be given of Rs.30.40 crores,

admittedly were reduced to Rs.8.63 crores on the date when Application

came for consideration as has been noticed by Adjudicating Authority.

When the Corporate Debtor was ready to offer 100% cash margin or CBG,

rejection of the said is not acceptable. Furthermore, the SBI itself on

13.12.2023, granted further one months' time from the date of receipt of

the letter for submitting 100% cash margin or CBGs. The Corporate Debtor

has prayed for extension of 30 days' time during which the Corporate

Debtor has taken steps to submit CBGs, but the SBI refused to accept the

said CBGs.

14. After having heard learned Counsel for the parties, it is clear that

settlement amount having been paid, the Adjudicating Authority did not

commit any error in rejecting Section 7 Application, which was only based

on Corporate Debtor not being able to de-risk the live BGs within the time

allowed. The present is not a case that BGs were invoked and the Corporate

Debtor was asked to deposit the amount for invoked BGs. The BG were

given by the Bank with regard to various contracts, which were undertaken

Company Appeal (AT) (Insolvency) No.1174 of 2023 15 by the Corporate Debtor and Corporate Debtor was always ready to deposit

the amount by 100% cash margin or by giving CBGs. The learned Senior

Counsel for the Corporate Debtor has further submitted that after filing of

the Appeal the Corporate Debtor has deposited amount of Rs.3.38 crores,

which was required by the Bank for extension of two BGs, which were

expiring and the amount of Rs.3.38 crores was deposited by the Corporate

Debtor, reducing the amount of live BGs to the extent of Rs.4.27 crores

only. Further, the case of the Corporate Debtor is that after expiry of two

BGs on 11.04.2024, today, the live BGs, which need to be de-risked are

only to the extent of Rs.3.68 crores.

15. In the facts of the present case, we are of the view that ends of justice

will be served in directing the Corporate Debtor to deposit the amount of

Rs.3.68 crores with the Appellant, which will be kept in no lien account, to

be utilized for clearing the liabilities pertaining to outstanding PBGs, if any.

The SBI after adjusting all its liabilities towards live PBGs, may refund the

balance amount to the Corporate Debtor. On deposit of the amount of

Rs.3.68 crores by the Corporate Debtor, the SBI to release all securities

over subject facilities.

16. In view of the foregoing discussions, we dispose of this Appeal in

following manner:

(I) The impugned order of the Adjudicating Authority dated

18.07.2023 dismissing Section 7 Application filed by the

Appellant, is up held.

Company Appeal (AT) (Insolvency) No.1174 of 2023 16 (II) The Corporate Debtor to deposit the amount of Rs.3.68 crores

with the Appellant within thirty days from today, which shall

be kept in no lien account, to be utilized for clearing the

liabilities of existing live PBGs, if any. After satisfaction of all

live PBGs, the SBI to refund the balance amount to the

Corporate Debtor.

(III) On deposit of amount of Rs.3.68 crores, the Appellant shall

release securities over subject properties and handover the

relevant documents to the Corporate Debtor.

Parties shall bear their own costs.

[Justice Ashok Bhushan] Chairperson

[Barun Mitra] Member (Technical)

[Arun Baroka] Member (Technical)

NEW DELHI

23rd April, 2024

Ashwani

Company Appeal (AT) (Insolvency) No.1174 of 2023 17