The NCLAT has overturned the insolvency resolution proceedings against BD&P Hotels (India), a subsidiary of real estate giant B Realty. An earlier NCLT order, based on Bank of India's petition for corporate insolvency resolution, claimed dues of ?111.61 crore. BD&P Hotels secured a term loan of ?65 crore repayable over four years, which turned non-performing due to payment issues. The company has since cleared all dues, leading the tribunal to close the CIRP and release BD&P from insolvency.
The National Company Law Appellate Tribunal (NCLAT) has invalidated the insolvency resolution proceedings against BD&P Hotels (India), a subsidiary entity of the publicly-listed real estate giant B Realty. This decision comes as the NCLAT overruled a prior ruling by the National Company Law Tribunal (NCLT).
The saga began in June when the Mumbai division of the bankruptcy court accepted a plea from Bank of India, pushing for BD&P Hotels (India) to be included in the corporate insolvency resolution process (CIRP). The bank was asserting its right to recover outstanding dues amounting to ?111.61 crore from the company.
Bank of India had initially granted a term loan of ?65 crore, secured against the hotel's projected cash receivables. This loan carried a repayment schedule of 18 quarterly uneven instalments, starting from October 2013, and was set to span a total period of four years and seven months.
The financial strain caused by liquidity issues led to BD&P Hotels (India) falling behind on interest payments and instalment obligations. As a result, the account was categorized as a non-performing asset (NPA) in accordance with the Reserve Bank of India's guidelines, beginning in June 2015.
However, in a recent turn of events, BD&P Hotels (India) has successfully made complete payments and presented evidence to the tribunal that all dues have been settled. In light of this development, the tribunal has dismissed the case, effectively closing the CIRP and releasing the real estate developer from the insolvency proceedings.
Representatives from AMR Law, namely Munaf Virjee and Akash Agarwal, who were advising the Mumbai-based realty firm, refrained from providing comments on the matter. Additionally, queries directed at DB Realty, the parent company of BD&P Hotels (India), remained unanswered as of the time of publication.
An earlier affidavit submitted by BD&P Hotels (India) had challenged the computation of the claimed dues, labeling the amount of ?111.61 crore as misguided and erroneous. The company pointed out that the loan of ?65 crore was acquired in 2013, and the bank had yet to adequately demonstrate how the dues had escalated to the sum demanded by the lender.
Advertisement
Facebook
Whatsapp
