Bank of Baroda Vs Ajit Kumar (NCLT Mumbai)
In a significant ruling, the National Company Law Tribunal (NCLT) Mumbai addressed the legal implications surrounding the necessity of a No Objection Certificate (NOC) in the insolvency proceedings of Omkar Speciality Chemicals Limited. The case, Bank of Baroda Vs Ajit Kumar, centers on the challenges raised by Bank of Baroda regarding the admission of claims by Axis Bank and NKGSB Co-operative Bank as secured creditors without obtaining an NOC from the primary creditor, Bank of Baroda.
The application was filed under Section 60(5) of the Insolvency and Bankruptcy Code, 2016 (the Code) by Bank of Baroda, which sought to have the claims of Axis Bank and NKGSB reclassified from secured to unsecured, arguing that the creation of a charge on the Corporate Debtor’s assets was invalid due to the absence of an NOC.
Background of the Case
Omkar Speciality Chemicals Limited approached Bank of Baroda for credit facilities. In January 2009, the bank sanctioned a loan of ₹32.10 crores, secured against multiple assets of the company. Later, in October 2015, a corporate loan of ₹50 crores was sanctioned, also secured by various assets.
The Corporate Debtor faced insolvency, leading to a Corporate Insolvency Resolution Process (CIRP) initiated on December 5, 2022, under CP(IB) No. 1738/MB/2017. An Interim Resolution Professional (IRP) was appointed, and claims were invited from creditors.
