Omkara Assets Reconstruction Private Limited Vs Ego Flooring Private Limited (NCLT Mumbai)
National Company Law Tribunal (NCLT), Mumbai Bench, in Omkara Assets Reconstruction Private Limited vs. Ego Flooring Private Limited, admitted an application filed under Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016 for initiation of Corporate Insolvency Resolution Process (CIRP) against the corporate debtor, Ego Flooring Pvt. Ltd. The case revolved around a financial debt originally extended by IndusInd Bank Ltd., later assigned to the applicant, Omkara Assets Reconstruction Pvt. Ltd., and the respondent’s objections on limitation, Section 10A applicability, and alleged procedural abuse.
Background and Facts
Ego Flooring Pvt. Ltd. had availed cash credit facilities of ₹825 lakhs from IndusInd Bank under sanction letters issued in May 2016 and modified in June 2016. The debt was secured by hypothecation and mortgage of properties through several agreements, including a Deed of Hypothecation, Master General Terms Agreement, and Memorandum of Deposit of Title Deeds. The facility was renewed for ₹475 lakhs through a sanction letter dated 14 May 2018. The renewal was valid for one year, expiring on 13 May 2019, and no further renewal was produced.
The debtor defaulted in repayment, and the bank issued a demand notice under Section 13(2) of the SARFAESI Act on 18 June 2021 demanding ₹4.63 crore. Subsequently, IndusInd Bank assigned the debt to Omkara ARC under an Assignment Agreement dated 30 September 2021. Despite repeated notices, the corporate debtor failed to pay, leading to this Section 7 petition claiming a default amount of ₹6.49 crore (including interest) as on 31 December 2023.
