Mumbai: The National Company Law Tribunal (NCLT), Mumbai, has allowed J C Flowers (JCF) Asset Reconstruction Private Limited, acting in its capacity as a trustee of JCF YES Trust, to initiate corporate insolvency resolution process against E-Commerce Magnum Solution.
About The Order
The order comes after the tribunal found that E-Commerce Magnum Solution failed to repay financial debt to the tune of Rs 340.68 crore to the former company. As per the petitioner’s say, a loan was executed between Yes Bank and E-Commerce Magnum Solution to avail credit facilities of Rs 500 crore. However, of the sanctioned limit of Rs 500 crore, Yes Bank had disbursed a loan of Rs 283 crore. As per the account statement, the outstanding loan amount was of Rs 340 crore.
Term Loan was sanctioned for the purpose of construction and development of a project, namely, ‘One Hughes’. After the company failed to repay the loan amount in time, Yes Bank filed a case against it.
Debtor Company Opposes The Petition
The petition was opposed by the debtor company. It said that there was no amount fallen due on which the interest could have been charged by the creditor company.
The tribunal after hearing both the parties held: “E-Commerce Magnum Solution was making the payments towards the interest on term loans until August 2019, but post that no payment was made towards the interest. Thus as per Yes Bank, the default date of payment is September 1, 2019. Due to the continuing defaults on the part of the defaulter company, the entire loan facility amounting to Rs297,80,94,329 was recalled vide a notice dated January 15, 2020. This continuous failure on the part of the defaulter company in repayment of the financial debt to Yes Bank of over Rs1 crore, and has been satisfactorily established from the records.” The tribunal thus while passing orders said: “We are left with no choice but to admit ECommerce Magnum Solution into the corporate insolvency resolution process, and an interim insolvency professional is being appointed to carry out the functions accordingly.”
