The Special Bench of the National Company Law Tribunal (NCLT), Chennai admitted insolvency proceedings against New Chennai Township Pvt. Ltd. for default in payment of dues worth over ₹400 crore. The petition was filed by Phoenix ARC Pvt. Ltd. The company is behind Marg’s flagship project Swarnabhoomi, near Seekanakuppam.
NCLT noted the case was filed before November 10, 2017 and since then, no change has been seen in the requests for adjournment by the firm, except saying that if more time were given it would resolve it through settlement talks.
The NCLT also had given a final chance to the company to make payment of ₹10 crore against ₹160 crore which was agreed as one-time settlement agreed between the parties before May 3, 2019. However, the company has made a payment of ₹1 crore and NCLT refused to adjourn the case any further.
According to court documents, the debt was assigned to Phoenix ARC Private Limited by Central Bank of India. In 2011 and 2012, the bank had sanctioned credit facilities aggregating to ₹193.29 crore.
Despite given an long rope before filing the insolvency petition, the company was able to pay only ₹7.5 crore against the liability of ₹412 crore. Even after taking about two years’ time, the company has failed to generate funds to clear the debt, NCLT said.
Since there is no settlement between the parties, NCLT said the case is fit for admission and appointed L.K. Sivaramakrishnan, as interim resolution professional.
