Bank of India Limited Vs Distribution Logistics Infrastucture Pvt. Ltd. (NCLT Mumbai)
The National Company Law Tribunal (NCLT), Mumbai Bench, dealt with an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) by a financial creditor seeking initiation of Corporate Insolvency Resolution Process (CIRP) against a logistics and warehousing company. The application claimed a default amount of Rs. 77.30 crore as on 30.09.2024.
The financial creditor stated that various credit facilities, including term loans, FITL facilities, and cash credit facilities, had been sanctioned to the corporate debtor between 2013 and 2022 under consortium banking arrangements involving multiple banks. The facilities were repeatedly restructured through sanction letters and restructuring agreements, including a Master Restructuring Agreement executed on 26.06.2021 after all consortiums merged under the leadership of Bank of Baroda.
According to the financial creditor, the corporate debtor faced liquidity issues and failed to maintain financial discipline. Despite repeated follow-ups, the accounts were not regularized. The creditor stated that default occurred on 29.12.2022 and the accounts were classified as Non-Performing Assets (NPA) on 28.03.2023. A demand notice under Section 13(2) of the SARFAESI Act was issued on 23.12.2024, but the dues remained unpaid.
The total amount claimed consisted of outstanding principal, nominal interest, and penal interest relating to term loans and FITL facilities. The financial creditor also detailed extensive securities and collateral, including charges over immovable and movable assets, project assets, bank accounts, concession rights, insurance contracts, fixed deposits, mortgages over land at Palwal and Nagpur, and pledge of shares. Guarantees from several entities were also furnished.
