H.P. Chaturvedi, Member - (1.) The present Application is filed by the Corporate Applicant/Corporate Debtor under Section 10 of Insolvency and Bankruptcy Code, 2016 read with Rule 7 of the Insolvency and Bankruptcy (Application to Adjudicating Authority) Rules, 2016.
(2.) The Corporate Debtor/Applicant submits that total amount of Debt is Rs. 35121.91 Lacs, it has committed default in making payment of Principal Amount of Rs. 10308.82 Lacs further interest amount of Rs. 23900.31 Lacs. The same being in excess of Rs. 1,00,000/- (Rs. 1 lac) the corporate applicant has eligibility to initiate for the Corporate Insolvency Resolution Process as per the Insolvency and Bankruptcy Code, 2016.
(3.) The brief facts raising to the present Application are described in brief as under: I. LML Limited ("LML" or the "Company") (originally known and registered as Lohia Machines Pvt. Ltd. was incorporated on 29.09.1972. The name of the Company was changed in 26.06.1978 to Lohia Machines Limited and later in 06.05.1987 to LML Limited with the approval of Registrar of Companies, Kanpur. II. Due to shift in the 2 - wheeler market, manufacture of 4 stroke motorcycle became vital for LML. It entered into a technical collaboration with Daelim of South Korea (a Honda pedigree) for making 4 - stroke motorcycle. III. Several proposals (2001-2004) were submitted by LML to its lenders but none could materialize in spite of all reasonable efforts of LML and it continued to suffer severe losses and erosion of liquidity. IV. Eventually, the lenders and LML entered into a Multi partite Agreement dated 28th March, 2005 which superseded and subsumed inter alia all previous agreement between LML and all the lenders. V. Due to losses the net worth of LML eroded and the Company filed a reference under the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 ("SICA") with the Board for Industrial and Financial Reconstruction ("BIRR") in the year 2006 which was registered on 15.09.2006 as Case No. 80 of 2006. On 08.05.2007, the BIFR declared the Company as a sick industrial company and appointed IDBI as the Operating agency ("OA"). VI. In spite of severe constraints and difficulties, the promoters of LML relentlessly pursued efforts to revive the Company. In January 2011, LML submitted the Draft Revival Scheme (DRS) to BIFR. After several rounds of discussions and meetings on DRS, consensus was reached between LML and the lenders for settlement of their dues. VII. LML has 9 Lenders. It received written approval on various dates inter-alia regarding settlement of their dues from 7 Lender's ("settlement Agreement") representing approx. 96.69% (by value of the debt). Each settlement Agreement representing approx. 96.69% (by value of debt). Each settlement Agreement was acted upon by LML, respective lenders and the guarantors. VIII. LML did not receive approval form 2 Lenders, namely, ICICI (core principal Rs. 304.24 lacs) and IIBI (core principal Rs. 0.44 lacs), who represent 2.88% and 0.42 % (by value) of the debt, respectively. IIBI assigned its debt to Phoenix ARC Pvt. Ltd. through a purported Deed of Assignment ("DoA") which has been challenged by LML in the Civil Court No. 1731 of 2015 at Kanpur Nagar, Kanpur, and the matter is sub-judice. IX. In March 2014, EXIM Bank, one of the Lenders who had also executed and acted on their Settlement Agreement, assigned their debt through a purported DoA to Edelweiss Asset Reconstruction Company Ltd. ("EARCL") which has been challenged by the LML in the Civil Court (OS No. 929/2016) at Kanpur Nagar, Kanpur, and the matter is sub-judice. X. In December 2015, Stressed Assets Stabilization Fund ("SASF"), one of the Lenders, who had also executed and acted on their Settlement Agreement, unilaterally withdrew from the Settlement Agreement and the same has been challenged by the LML in the Civil Court (OS No. 768 of 2016) at Kanpur Nagar, Kanpur, and the matter is sub-judice. XI. State Bank of India, who had also executed and acted on their Settlement Agreement, has filed an OA No. 238 of 2017 dated 30.03.2017 with Debt Recovery Tribunal, Allahabad. The matter is pending and the next date of hearing is 21.06.2017.;