The Mumbai bench of the National Company Law Tribunal (NCLT) on Thursday reserved its order on the insolvency petition filed by the Punjab National Bank (PNB) against NRC Ltd, formerly known as National Rayon Corp. Ltd.
NRC is one of the leading companies of Kolkata-based Duncan Goenka Group.
The counsel for Punjab National Bank argued that there is an admitted debt by the company and previously, too, the bank had agreed to a one-time settlement (OTS), but the company failed to honour that as well.
“The company has sought several one-time settlement offers from the bank, but nothing worked out. In the last settlement offer, the company had to pay the first tranche of ₹5.1 crore before 5 November 2018, but the company failed to do so and hence, it’s a fit case to admit for the resolution process,” the counsel told the dedicated bankruptcy court.
The NRC counsel, however, said it could not make the payment due to the Diwali holidays, and sought more time to pay the first tranche as per the one-time settlement.
After hearing the arguments, a division bench of Bhaskara Pantula Mohan and V. Nallasenapathy reserved its order, observing the tribunal has given enough opportunities to the company.
The bank has approached the court to recover Rs. 270 crore from NRC, which makes viscose filament yarn and nylon tyre cord fabric and chemicals including caustic soda and sulphuric acid. The bank has proposed the name of Vikas Gupta, an independent consultant as interim resolution professional (IRP) to initiate the corporate insolvency resolution process (CIRP) of the company.
Founded in 1946, NRC is one of the flagship companies of Duncan Goenka Group, which is currently controlled by Gauri Prashad Goenka. The group also owns tea plantation, manufacturing and marketing business through its subsidiaries Duncans Industries Ltd and Duncans Tea Ltd.
The company was a declared non-performing asset (NPA) in May 2010. Later, it was admitted to the Board for Industrial and Financial Reconstruction (BIFR). However, lenders approached the Mumbai bench of the National Company Law Tribunal in 2017 since BIFR was dissolved after the introduction of the Insolvency and Bankruptcy Code (IBC).
As per the company’s annual report, NRC in FY 2018 reported a loss of Rs 6.73 crore against Rs 14.20 crore in FY 2017 and the company’s net debt for the same period stood at Rs 376.66 crore during and Rs. 384.73 crore respectively.
An email query to NRC remained unanswered till the time of filing the report.
Source: Livemint, November 16,2018