NCLT Mumbai Initiates Insolvency Proceedings Against Sahara Hospitality, Owner Of Hotel Sahara Star
The National Company Law Tribunal's (NCLT) Mumbai bench has initiated insolvency proceedings against Sahara Hospitality Limited, that owns Hotel Sahara Star, for an alleged default of around Rs 50 crore. Judicial Member Justice P.N. Deshmukh (retd) and Technical Member Shyam Babu Gautam admitted a Company Petition (CP) under Section 9 of the Insolvency & Bankruptcy Code,...
The National Company Law Tribunal's (NCLT) Mumbai bench has initiated insolvency proceedings against Sahara Hospitality Limited, that owns Hotel Sahara Star, for an alleged default of around Rs 50 crore.
Judicial Member Justice P.N. Deshmukh (retd) and Technical Member Shyam Babu Gautam admitted a Company Petition (CP) under Section 9 of the Insolvency & Bankruptcy Code, 2016 against Sahara Hospitality Limited, on account of default to Delta Electro Mechanical Private Limited.
The NCLT has appointed Mamta Binani as the Interim-Resolution Professional to run the company's day-to-day affairs, as the company's four directors have been suspended.
Sahara Hospitality had awarded a work order to Delta Electro Mechanical Private Limited, for supply, installation, testing and commission of HVAC and electrical system at Hotel Sahara Star, Mumbai for a principal amount of around Rs. 32 crore. However, Sahara defaulted in payment.
Delta Electro Mechanical initially approached the NCLT in a Company Petition in 2018, which was disposed of in 2021 after Sahara agreed to settle the matter for Rs. 20 crore to be paid in 14 instalments.
The operational creditor Delta Electro Mechanical was represented by advocates Abhay Itagi and Monica Varma of M.V.Kini Law Firm.
Delta Electro Mechanical approached the NCLT again seeking revival of the CP in 2019 after Sahara failed to honour the commitment.
Sahara contended that it entered into consent to maintain good business relations and the company petition was withdrawn and disposed of. However, after the settlement agreement failed and CP was disposed of the petition could not be admitted without a prayer of restoration.
The bench observed that Delta Electro Mechanical was granted permission to re-approach the NCLT in case of a breach.
The bench further observed that since the settlement agreement was breached, the existence of debt and default being "proved", Sahara had accepted its liability.
"Further the Corporate Debtor has also nothing stated on the merits of the case nor has denied the liability accrued with regards to the facilities extended. Hence it is clear that the liability to repay falls on the Corporate Debtor," the bench said in the order.
The NCLT has asked the creditor to deposit Rs. 5 lakh towards the initial Corporate Insolvency Resolution Process cost. The bench has also prohibited institution of suits or continuation of pending suits or proceedings in any court of law against Sahara including execution of any judgment, decree.