KOTAK RESOURCES Vs. RANINGA ISPAT PVT LTD

JUDGEMENT

(1.) M/S. Kotak Resources styling itself as financial creditor, filed petition under section 7 of The Insolvency and Bankruptcy Code, 2016 (hereinafter referred to as "the Code") read with Rule 4 of The Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016 (hereinafter referred to as "the Rules") requesting this Authority to commence Corporate Insolvency Resolution Process in respect of M/s. Raninga Ispat Private Limited styling it as corporate debtor.

(2.) The petition is signed by one Anil Chunilal Varma as authorised fa signatory of Kotak Resources on the basis of power of attorney dated 07.11.2017 executed by the proprietor of Kotak Resources in favour of Anil Chunilal Varma authorising him to file Insolvency Proceedings against Raninga Ispat Private Limited under the provisions of Insolvency and Bankruptcy Code.

(3.) It is the case of the petitioner that an amount of Rs. 1.00 crore have been lent to the respondent through Navis Multitrade Private Limited. The terms of finance made by Navis Multitrade Private Limited and petitioner to the respondent are mentioned in agreement dated 05.09.2012. As per the terms of the agreement Navis Multitrade Private Limited and petitioner are entitled to commission of Rs. 0.50 per kg. of pig iron manufactured by the respondent and the payment has to be made on weekly basis. Respondent assured that there will be minimum guaranteed production of 80 tonnes per day. It is the case of the petitioner that the amount outstanding towards commission is Rs. 1,46,00,000/- per annum and for five years the said amount is aggregating to Rs. 7,30,00,000/-. The agreement envisages return of loan by respondent to Navis Multitrade Private Limited and petitioner. As security for the amount lent to respondent by Navis Multitrade Private Limited and petitioner, Mr. Pravin Raninga and all shareholders have pledged 3,10,000 fully paid up equity shares owned by all of them of the respondent company and collateral charge was created for the amount borrowed by the respondent. Respondent has defaulted in its obligation in payment of M commission as well as repayment of amount borrowed. Inspite of repeated reminders and personal meetings total amount outstanding for loan as well as for commission is Rs. 8,30,00,000/- along with interest @ 18% per annum from the date of disbursement of loan. Respondent issued post-dated cheques as security and it was also dishonoured for insufficient funds in the bank account of respondents. In good faith petitioner did not initiate action on the basis of dishonoured fa cheques. According to petitioner, respondent committed default in payment of commission amount of Rs. 7,30,00,000 and repayment of Rs. 1,00,00,000/- loan amount. Petitioner called upon the respondent to pay entire dues along with interest @ 18% per annum on annualised basis commencing from 05.09.2012 within ten days from the date of receipt.