PARK TOWN BENEFIT FUND LIMITED Vs. STATE

JUDGEMENT

(1.) M/s. Park Town Benefit Fund Limited (hereinafter referred to as the 'Company') has filed this application for sanctioning the scheme of arrangement between company and its unsecured creditors, including Depositors, Due Slip and Cash Warrant Holders as per scheme of arrangement, annexed with the typeset of papers as Annexure-D (Pg.106).

(2.) The Petitioner company was incorporated in the year 1985 as a Public Limited Company with capital of Rs. 5,00,000/- (Rupees Five Lakhs only). The company was engaged in the business of accepting deposits from the shareholders, members and the deposits mobilized from the shareholder members were deployed against the mortgage of immovable properties in accordance with the guidelines prescribed by the Department of Company Affairs. Inspite of financial difficulties faced by the Petitioner company, till the year 2002 - 2003, the company promptly honored the interest commitments of their depositors and there were no complaints from single depositor with regard to payment of interest on deposits.

(3.) The Petitioner company took sincere efforts to collect loan from the willful defaulters and settled all the depositors uniformly. However, the borrowers are negotiating for waiver of interest on the loan, on the plea that loss was suffered by them in the business. Keeping in view the genuine request, the company was forced to allow huge discount on the loan amount, and it could collect only a part of the arrears, as one time settlement. Because of the difficulties faced by the company, out of total deposits of Rs. 170 crores in the year 1999, about 158 crores were repaid to 92.5% of the depositors.