The Chandigarh bench of the National Company Law Tribunal (NCLT) on Friday issued notice to Liberty House Group (LHG) in connection with Castex Technologies lenders’ plea to withdraw the approved resolution plan submitted by the UK-based firm.
The two-member bench also directed LHG to submit its reply by January 9, 2019, and scheduled the matter for further hearing on January 11. On Friday, the matter was argued, but not admitted.
On behalf of the lenders for bankrupt Amtek Auto’s debt-ridden subsidiary Castex Technologies, State Bank of India (SBI) moved the NCLT to withdraw an application that had sought the tribunal’s nod to go ahead with the approved resolution plan of the UK-based firm under section 30 (6), 60 (5) and 74 of the Insolvency and Bankruptcy Code (IBC).
The application was filed as LHG failed to comply with even the basic requirement of furnishing the performance bank guarantee (PBG), which was required to be given upon approval of the resolution plan by the CoC. “The inability of the resolution applicant in submitting the PBG of Rs 100 crore casts doubts on its ability to implement the resolution plan, which contemplates total payment of Rs 2,505 crore,” SBI said in its petition.
LHG has also defaulted on paying the committed upfront money in time to the lenders of Amtek Auto, which prompted them to move NCLT seeking directions on the way forward. The matter will be heard on December 18. On July 25, lenders had approved LHG’s resolution plan for Amtek Auto that sought to pay financial creditors `3,225 crore upfront and make fresh infusion of `500 crore into the company for improving operations.
The lenders have already got NCLT’s approval to withdraw the resolution plan for ARGL, also an Amtek Auto subsidiary, where again LHG had failed to comply with the conditions of providing the PBG. LHG has also defaulted in implementing the resolution plan in the case of Adhunik Metaliks.
The resolution plan submitted by LHG for Castex Technologies was approved by the CoC on August 27 with a majority of 98.8% vote. Castex’s resolution professional Dinkar Venkatsubramanian had on September 4 filed an application before the NCLT to approve the plan. However, on September 28, the CoC decided to bring the non-payment of the PBG issue before the NCLT.
Source: Financial Express, December 15, 2018