10 September 2019: The National Company Law Appellate Tribunal (NCLAT) has set aside the NCLT, Kolkata bench’s August 28 order that admitted Religare Finvest’s insolvency plea against Kolkata-based Bharat Road Network (BRNL). The appellate tribunal directed the adjudicating authority to close the matter.
“Taking into consideration the fact that the committee of creditors has not yet been constituted and the parties have settled the matter, we set aside the impugned order dated August 28, 2019, and dismiss the application under Section 7 of the IBC filed by Religare Finvest. The adjudicating authority will now close the company petition,” said the three-member NCLAT bench, headed by chairman Justice SJ Mukhopadhaya. Religare, an NBFC, had given a Rs 50 crore loan to BRNL for a year on December 14, 2016, at an interest rate of 12.5%. The interest component was to be paid on a quarterly basis. However, as BRNL defaulted, Religare took the company to the insolvency court.
During the course of the hearing, Religare’s counsel had informed NCLAT that the two parties had agreed for a settlement prior to the order passed by the NCLT, Kolkata. BRNL said, it had handed over a demand draft issued on September 5, 2019 to the authorised representative of Religare.
BRNL is engaged into road construction and has a portfolio of six Build Operate Transfer (BOT) projects. Challenging the NCLT order before the NCLAT, BRNL had submitted that it had requested the tribunal to defer the pronouncement of order as it was willing to pay out Religare’s debt.
The NCLAT observed that the IRP has functioned since about 10 days since the admission of the insolvency petition and thus, directed the company to pay Rs 1.5 lakh as his fees and cost. The appellate tribunal also set aside NCLT’s direction to appoint an Interim Resolution Professional (IRP) declaring moratorium against the lenders of the company.