Insolvency Proceedings Initiated Against Birla Tyres Ltd., A B.K. Birla Group Company: NCLT, Kolkata
Pallavi Mishra
8 May 2022 3:51 PM GMT
The National Company Law Tribunal ("NCLT") Kolkata Bench, comprising of Rohit Kapoor (Judicial Member) and Shri Harish Chander Suri (Technical Member) while adjudicating a petition filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 ("IBC") in the matter of SRF Limited v Birla Tyres Ltd., has initiated Corporate Insolvency Resolution Process ("CIRP") against Birla Tyres...
The National Company Law Tribunal ("NCLT") Kolkata Bench, comprising of Rohit Kapoor (Judicial Member) and Shri Harish Chander Suri (Technical Member) while adjudicating a petition filed under Section 9 of the Insolvency and Bankruptcy Code, 2016 ("IBC") in the matter of SRF Limited v Birla Tyres Ltd., has initiated Corporate Insolvency Resolution Process ("CIRP") against Birla Tyres Ltd. and appointed Mr. Seikh Abdul Salam as the Interim Resolution Professional. The order was passed on 05.05.2022.
Background Facts
Birla Tyres Ltd. is a part of B.K. Birla Group of Companies. In 1991, it was incorporated as a part of Kesoram Industries Ltd. but was later demerged in 2018 as a part of re-structuring plan. In Financial Year 2021, Birla Tyres had made losses to the tune of Rs 287.63 Crore, while total revenue stood at Rs 153.11 Crore.
SRF Ltd. ("Operational Creditor") had supplied Tire Cord Fabric to Birla Tyres Ltd. (Corporate Debtor) between 2018-19 in view of Work Order dated 06.04.2018. When payment against the supplies were not received, the Operational Creditor had served a Demand Notice upon the Corporate Debtor for an amount of Rs.15,84,53,695.75/- (inclusive of interest), wherein the principal amount was Rs.10,06,42,246.75/-. The Corporate Debtor had addressed an email to the Operational Creditor on 03.06.2020 admitting the debt of Rs. 10.18 Crores, and had paid Rs. 10,00,000/- as its last payment to the Operational Creditor.
As no subsequent payments were received, on 23.07.2021 the Operational Creditor issued a Demand Notice under Section 8(1) of the IBC to the Corporate Debtor and the latter neither disputed the demand nor tendered any response to the same. Accordingly, the Operational Creditor filed a petition under Section 9 of IBC before NCLT Kolkata ("Adjudicating Authority") seeking initiation of CIRP against the Corporate Debtor. Despite several opportunities, the Corporate Debtor failed to file any response to the petition.
The Adjudicating Authority observed that there was an admitted and undisputed debt and passed an order for initiation of CIRP against the Corporate Debtor.
Case title: SRF Limited v Birla Tyres Ltd., C.P. (IB) No. 250/KB/2021.
Counsel for Operational Debtor: Ms. Meenakshi Manot, Ms. Iram Hassan and Mr. Sanket Sarawgi, Advocates.
Counsel for Corporate Debtor: Ms. Manju Bhuteria and Mr. Debarga Basu, Advocates.
Click Here To Read/Download Order
