NCLT Mumbai Admits Personal Insolvency Application Against Videocon's Promoter Rajkumar Dhoot
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice V.G. Bisht (Judicial Member) and Mr. Prabhat Kumar (Technical Member) has admitted personal insolvency application against Mr. Rajkumar Nandlal Dhoot, Promoter and Co-owner, of Videocon Industries Limited ('VIL'). The application was filed under Section 95 of the Insolvency and Bankruptcy Code, 2016 ('IBC') by...
The National Company Law Tribunal ('NCLT') Mumbai, comprising Justice V.G. Bisht (Judicial Member) and Mr. Prabhat Kumar (Technical Member) has admitted personal insolvency application against Mr. Rajkumar Nandlal Dhoot, Promoter and Co-owner, of Videocon Industries Limited ('VIL').
The application was filed under Section 95 of the Insolvency and Bankruptcy Code, 2016 ('IBC') by the State Bank of India ('SBI') to initiate an insolvency process against Mr. Rajkumar Dhoot to recover Rs. 5,353 crores which has been defaulted by VIL.
Background Facts:
VIL had secured various facilities from SBI under several loan documents and Mr. Rajkumar Dhoot guaranteed the repayment through a Deed of Guarantee dated 08.08.2012 and a Fourth Supplemental Joint Deed of Guarantee dated 25.05.2012
SBI had issued demand notices upon default by VIL for the Rupee Term Loan ('RTL') Facilities on 18.01.2018 and for the Working Capital Facilities on 23.01.2018. Subsequently, demand certificates were issued to Mr. Dhoot for the RTL Facilities on 02.02.2018 and for the Working Capital Facilities on 20.02.2018.
Due to continued default in repayment, SBI filed multiple insolvency petitions under Section 7 of the IBC against VIL and other associated entities. On 08.08.2019, the said petitions were admitted by the Tribunal and consolidation of the Corporate Insolvency Resolution Process was ordered for VIL with 12 other companies of the Videocon Group which is still pending.
On 23.07.2020, a demand notice under the IBC and the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 was issued to Mr. Dhoot. However, neither any response nor any payment for the default amount was made by Mr. Dhoot within fourteen days of receiving the notice.
Therefore, an insolvency application has been filed by SBI under Section 95 of the IBC against Mr. Rajkumar Nandlal Dhoot.
NCLT Verdict:
The NCLT Mumbai bench admitted the personal insolvency application against Mr. Rajkumar Nandlal Dhoot for the default amount of Rs. 5,335 crores defaulted by VIL.
The Tribunal held that:
“The Resolution Professional is directed to issue a public notice inviting claims from the creditor and to prepare a list for the same.”
“The personal guarantor shall prepare a repayment plan with the resolution professional, which will be placed before the committee of creditors. Once approved, it will be submitted for final approval.”
It observed that considering the demand notices, proof of service, guarantee deeds, joint deed of guarantee, etc, it can be stated that Mr. Rajkumar Nandlal Dhoot, personal guarantor to VIL has also committed a default in repayment of the loan facility demanded by the financial creditor after the invocation of personal guarantee.
Thus, SBI has satisfied the requirements as set out under Section 95 of IBC.
Case Title: State Bank of India through Asish Narayan vs. Mr. Rajkumar Nandlal Dhoot
Case No.: C.P. (IB) NO. 1195/MB/2020
Counsel for Applicant: Mr. Animesh Bisht, Mr. Anush Mathkar, Jeta Shree, Mr. Vihit Shah, Advocates, Cyril Amarchand Mangaldas
Counsel for Respondent: Mr. Sandeep Ladda, Advocate a/w Mr. Adnan Ansari, Advocate