The absence of a formal deed of guarantee precludes liability for financial debt under the Insolvency Code, rendering the application for insolvency resolution not maintainable.

ORDER

PER: MANNI SANKARIAH SHANMUGA SUNDARAM, MEMBER (JUDICIAL)

1. The present Application has been filed on behalf of Canara Bank (“Applicant/Financial Creditor”) under Section 7 of the Insolvency and the Bankruptcy Code, 2016 (“Code”) to initiate corporate insolvency resolution process against Rattanlndia Enterprises Limited (“Respondent/Corporate Debtor”) on the ground that the Corporate Debtor has defaulted in the payment of financial debt amounting to Rs. 3,72,35,67,407.77 (Rupees Three Hundred Seventy-Two Crore Thirty-Five Lakh Sixty-Seven Thousand four Hundred Seven and Seventy Seven Paisa) due as on 30.12.2024 along with penalties and future interest from 01.01.2025.

2. The Corporate Debtor herein Rattanlndia Enterprises Limited having CIN L74110DL2010PLC210263, incorporated under the provisions of the Companies Act, 1956 is having its registered office at 5th Floor, Tower-B, Worldmark 1, Aerocity, South West Delhi, New Delhi, Delhi, India, 110037. Since the registered office of the Corporate Debtor is situated in New Delhi, this Tribunal having jurisdiction over the NCT of Delhi is the Adjudicating Authority under sub-section (1) of section 60 of the Code in relation to the prayer for initiation of Corporate Insolvency Resolution Process against the Corporate Debtor.

3. SUBMISSIONS OF THE APPLICANT/FINANCIAL CREDITOR:

i. In the years 2010, 2014, 2016 Principal Borrower Sinnar Thermal Power Limited approached the Consortium of seven Banks/FIs led by Power Finance Corporation (PFC) for certain credit facilities for funding coal based thermal power project located in Multi product SEZ at Sinnar, District Nasik, Maharashtra. Accordingly, the Applicant bank along with Consortium of Banks vide sanction letter dated 26.02.2010 bearing Ref. No. 9044/NP/CREDIT/INDBULLS/2010 sanctioned Credit Facility-1 of Rs.100 Crore. Further, Applicant Bank along with Consortium of Banks vide sanction letter dated 26.03.2014 bearing Ref. No. 9044/ADV/85/NP/2013 sanctioned Credit Facility-2 (COR-1) of Rs. 15.57 Crores. Further, Applicant Bank along with Consortium of Banks vide sanction letter dated 30.08.2016 bearing Ref. No. 356/9044/2016 sanctioned Credit Facility-3 (COR-2) of Rs. 28.83 Crores.

ii. The Applicant Bank along with Consortium of Banks sanctioned credit facilities to the tune of Rs.144.40 Cr to the Principal Borrower in the following manner:

iii. The Facility-1 of Rs. 100 Crores Term Loan was valid till 30.09.2023, and was for setting of Coal based Thermal Power Project in Multi Product Special economic Zone at Sinnar Village in Nasik District in the state of Maharashtra. Facility-2 of Rs.15.57 Crores Term Loan for Cost Overrun Facility, and was to be repaid starting from October 2015. Facility- 3 of Rs. 28.83 Crores Term Loan for meeting the increased cost of project, and was to be repaid starting from 31.03.2017, to be paid in 10 years.

iv. As there was default in the repayment of the said enhanced facility, the account of the Principal Borrower slipped into Non-Performing Asset (NPA) on 28.09.2017 as per the guidelines and directions issued by the Reserve Bank of India.

v. In spite of repeated follow up with the Principal Borrower, no serious steps were taken by the Principal Borrower to clear the dues of Applicant Bank/Financial Creditor and as the account was still continuing as NPA, therefore Applicant Bank sent recall notice on 30.09.2020 bearing Ref. No. LN/Re-CALL/to the Principal Borrower and demanded the entire outstanding amount of Rs. 202,03,39,436.49/- (Rs. Two Hundred Two Crores Three Lakh Thirty-Nine Thousand Four Hundred Thirty-Six and Forty Nine Paise) which included Principal, Interest and other charges upto 31.07.2020.

vi. The Applicant Bank on 09.06.2021 also sent a Notice under Section 13(2) S