Delhi High Court stays insolvency proceedings against BILT Graphic

Team SoOLEGAL 1 Mar 2018 12:31pm

Delhi High Court stays insolvency proceedings against BILT Graphic

New Delhi :The Delhi High Court has stayed insolvency proceedings initiated by IDBI bank against Bilt Graphic Papers, a Avantha Group company. The company has taken loans worth Rs 7,000 crore and had defaulted in repayment of its loan. RBI in August 2017 had put the company in the category of 29 companies against which bankruptcy was to be initiated if the cases were not resolved by December 13.

Following this ,majority of the lenders agreed to restructure the loans but RBI rejected this proposal on the grounds that all lenders had not agreed to restructuring. Post this IDBI initiated Insolvency proceeding against the company.

Senior counsel Mr Harish Salve, who appeared for the company in the matter, stated that Master Reconstruction Agreement (MRA) was signed and approved by 71% of the lenders which constituted 61% in terms of value of the loans. This violates RBI rules under which it states that bankruptcy can be initiated only if bankers who have given loans are not equal or less than 60 % of the value of loan and 50% of the total number of the banks, which is not the case in this matter.

The lawyer representing the bankers objected to this saying this is not a subject matter for civil court.

However the High Court asked IDBI bank to maintain status quo, saying it will next hear the matter on May 24.

Tagged: Bilt Graphic   RBI   Delhi High Court   IDBI bank  
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