NOIDA: The National Company Law Tribunal (NCLT) has appointed an interim resolution professional (IRP) for Knightbridge – a luxury residential and commercial project developed by ATS in Sector 124 – after a financial services company alleged that the realtor had defaulted on debenture returns worth Rs 285 crore.
While Gaurav Katiyar was appointed the IRP, Sunil Gaur, a former judge, was made the monitor for the project. Lawyer Fiza was appointed a co-monitor.
The tribunal’s April 22 order came on a petition submitted last year by ASK Group, which alleged that ATS was yet to return a principle of Rs 285 crore that it had deposited with the developer through debentures. It appealed to the NCLT to initiate a corporate insolvency resolution process (CIRP) against the developer.
ASK also alleged in its petition that ATS had also defaulted on repayment of more than Rs 500 crore it owed to another financial creditor, Piramal Capital and Housing Finance Limited. According to the petition, ATS Heights had sought financial assistance from Piramal under three facilities – debenture subscription of Rs 215 crore, a term loan of Rs 275 crore and an emergency credit line guarantee scheme of Rs 47.1 crore.
Although Piramal did not move court, ASK alleged that the developer’s credit rating for July last year reflected an outstanding amount of Rs 72 crore against the principal term loan and Rs 47 crore against the credit line guarantee scheme.
The petitioner also alleged that Piramal’s statement of account showed ATS had defaulted on debenture returns too. The statement of account also showed Rs 3 crore as interest overdue and Rs 14 crore as the principal amount outstanding.
ATS, in its reply, said the default alleged by ASK was a “figment of imagination” and an attempt to coerce the developer into paying amounts that were otherwise not due.
The realtor also sought to know why ASK was alleging default on behalf of Piramal when the latter itself had not moved court.
The NCLT bench of members Ashok Kumar Bhardwaj and Subrata Kumar Dash, however, admitted ASK Group’s plea and agreed there was indeed a default as evident from the financial statement of the corporate debtor.
“Indubitably, the applicants are financial creditors with respect to the corporate debtor, and they are entitled to institute the present proceedings not only for the debt owed to them but also the one owed to another financial creditor of the corporate debtor… In the present case, the default has been acknowledged in the financial statement of the CD. Besides, the petitioners have also filed the record of default recorded with the information utility, though disputed by the CD,” the tribunal observed.
“In view of the aforementioned analysis and discussions, we are left with no option but to admit the present application…. Thus, we deem it pertinent to observe that in the interest of homebuyers, the IRP would religiously discharge his duty under Section 20 of IBC, 2016, and would keep the corporate debtor (ATS Heights) as a going concern,” the order further read.
Along with the petition of ASK Group, the tribunal had clubbed other pleas by homebuyers and ATS Heights.
ATS Heights had bought 11.5 acres in Sector 124 from Logix Realtech in 2012 for Rs 604 crore to build Knightbridge – a project where flats start from Rs 9.5 crore. Around 60% of this project is commercial.
The project was initially supposed to come up on 6.5 acres, comprising 215 housing units besides shopping malls, retail shops, restaurants, and offices. Noida Authority sanctioned its layout plan for residential and commercial units in May 2016. The project has five towers of 47 floors each. At present, only the outer structure is ready.
