M. SURESH KUMAR REDDY Vs. CANARA BANK

JUDGEMENT

(1.) The respondent­Bank filed an application under Sec. 7 of the Insolvency and Bankruptcy Code, 2016 (for short, 'the IB Code') before the National Company Law Tribunal, Hyderabad, Telangana. The said application was filed against a Corporate Debtor M/s Kranthi Edifice Pvt. Ltd. The present appellant claims to be a suspended Director of the Corporate Debtor. National Company Law Tribunal (for short, 'NCLT'), by an Order dtd. 27/6/2022, admitted the application filed by the respondentBank and declared a moratorium for the purposes referred in Sec. 14 of the IB Code. The appellant claiming to be an aggrieved person preferred an appeal against the said Order before the National Company Law Appellate Tribunal (for short, 'NCLAT'). By the impugned judgment dtd. 5/8/2022, NCLAT has dismissed the appeal.

(2.) The first respondent, Canara Bank is the successor of Syndicate Bank, which made application under Sec. 7 of the IB Code to NCLT. Syndicate Bank was merged into the first respondent­Canara Bank. A letter of sanction dtd. 2/4/2016 was issued by Syndicate Bank by which credit facilities were sanctioned to the Corporate Debtor for one­year valid up to 28/2/2017. A Secured Overdraft Facility of Rs.12.00 crores was granted by the Syndicate Bank, apart from sanctioning the Bank Guarantee limit of Rs.110.00 crores. Thus, the facilities granted by the Syndicate Bank to the Corporate Debtor were fund­based (Overdraft Facility) and non­fund­based (Bank Guarantees).

(3.) In the application under Sec. 7 of the IB Code, the Syndicate Bank stated that as on 30/11/2019, the liability of the corporate debtor under the Secured Overdraft Facility was Rs.74,52,87,564.93. The liability of the Corporate Debtor towards outstanding Bank Guarantees was Rs.19,16,20,100..00