S. No. |
Name |
Amount |
Status |
Date of Admission/Rejection |
1. |
Janta Bank |
3.60 crores |
Financial Creditor |
20.9.2023 |
2. |
Parivaar Bank |
3.00 crores |
Financial Creditor |
20.9.2023 |
3. |
Rashi Singhania(wife of Paras Singhania) |
50 Lakhs |
Financial Creditor |
20.9.2023 |
4. |
Best Tradex |
1.60 crores |
Operational Creditor |
20.9.2023 |
5. |
Electrolux Supplies Inc |
45 lacs
|
Rejected as filed late |
18.12.2023 |
6. |
70 workmen |
1.60 crores |
Operational creditors |
20.9.2023 |
7. |
15 Employees |
1.50 crores |
Operational creditors |
20.9.2023 |
8. |
GST dues |
70 lacs |
Operational creditors |
20.9.2023 |
9. |
Income Tax dues |
30 lacs |
Operational creditors |
20.9.2023 |
10. |
Provident Fund Dues |
20 lacs |
Operational creditors |
20.9.2023 |
11. |
Revive Finance(filed on 4th September, 2023) |
1.50 crores |
Financial Creditor |
10.12.2023 |
12. |
Raman Nair (Loan to company without interest) |
1 crore |
Financial Creditor |
20.9.2023 |
13. |
Electricity dues |
25 lacs |
Operational Creditor |
20.9.2023 |
14. |
Big Lease -Landlord forarrears of Rent onlease of Principal Office |
10 lacs |
Financial Creditor |
20.9.2023 |
Financial Creditors – Rs. 9.70 crores
Operational Creditors – Rs. 6.15 crores
Total Rs. 15.85 crores
Date |
Particulars |
Debit |
Credit |
Balance |
1.4.2021 |
Opening Balance (Payable by Raman Nair) |
|
|
20,00,000 |
15.5.2021 |
Expense Adjustment/Received by CD |
|
5,00,000 |
15,00,000 |
17.8.2021 |
Paid by CD |
7,00,000 |
|
22,00,000 |
20.12.2021 |
Paid by CD |
2,00,000 |
|
24,00,000 |
12.4.2022 |
Expense Adjustment/Received by CD |
|
3,00,000 |
21,00,000 |
18.9.2022 |
Paid by CD |
1,00,000 |
|
22,00,000 |
2.1.2023 |
Expense Adjustment/Received by CD |
|
5,00,000 |
17,00,000 |
28.8.2023 |
Paid by CD |
6,00,000 |
|
23,00,000 |
RP has filed an application with the Adjudicating Authority (IA 25 of 2024) on 20th January 2024 claiming Rs 31 lacs (amount outstanding as on 30.8.2021 plus amounts paid by CD to Raman Nair on 20.12.2021, 18.9.2022 and 2.1.2023) as preferential transactions u/s 43 of the Code and prayed for recovery of these amounts. Raman Nair has filed a reply stating that these transactions are not preferential on the following grounds:
RP, in rejoinder, claims that payment transaction is not to be mixed with expense adjustment or amount received from Raman Nair. For amounts paid by Raman Nair, he should file a claim and there is no provision of set off in CIRP. The application in filing preferential transaction application was delayed due to non-cooperation of suspended directors in providing information to forensic auditor who had sent 2 emails to them. The final report was placed before committee of creditors who had directed RP to file application.
Suspended directors have filed a common reply stating that by no stretch of imaginations, write offs can be treated as fraudulent transaction as there is no outflow. RP has the freedom to revise the accounts and reverse the transactions in books. The amounts relate to 2016 and 2017 and is beyond the purview of scope of RP. Further, the investments were made in good faith to expand the business of CD but could not fructify. Moreover, RP has filed a single IA u/s 43 and 66, which is not permitted.
RP, argues that suspended directors had the knowledge of the fact that CD is going under insolvency and they should have taken steps to recover the amounts. The amounts written off in the books of CD are still being shown in the books of account of Hi-life Technologies Pvt Ltd and Super Motors Private Limited and produced financial statement of both the companies filed with Registrar of companies for FY 2022-23.
CSM 2 Case Study on PPIRP
ABC Ltd., a medium-sized manufacturing company based in India, has been struggling with financial difficulties exacerbated by the economic downturn caused by the COVID-19 pandemic. With mounting debt and dwindling revenues, ABC Ltd. finds itself in a situation where it needs to explore insolvency resolution options to salvage its operations and protect the interests of its stakeholders.
ABC Ltd. is classified as a medium enterprise under the Micro, Small and Medium Enterprises Development Act, 2006 though registration is pending. ABC Ltd. has committed a default of Rs 54 lacs to My Bank. The company has not undergone any insolvency resolution process in the past three years. Financial creditors representing at least 66% of the financial debt due to them have proposed the appointment of an insolvency professional for conducting the PPIRP.
A majority of the directors of ABC Ltd. have made a declaration stating the intent to initiate the PPIRP and affirming that it is not for fraudulent purposes. A special resolution has been passed by the members of ABC Ltd. approving the initiation of the PPIRP. There is an application under section 43 against one of the directors of ABC Limited for his involvement in Bright Star Limited, a company under CIRP. ABC Limited has prepared a draft Base Resolution Plan. ABC Limited files an application to the Adjudicating Authority for initiating pre-packaged insolvency resolution process. Base Resolution Plan prepared by ABC Ltd contains lower payment to financial creditors with a proposal to pay in full to the operational creditors.