The Chennai bench of National Company Law Tribunal (NCLT) has ordered commencement of the corporate insolvency resolution process against Empee Distilleries and appointed V Venkata Siva Kumar as interim resolution professional (IRP).
Empee Distilleries, one of the popular Indian made foreign spirits manufacturers in Tamil Nadu, was dragged to NCLT by Union Bank of India claiming dues of Rs 10.18 crore. The company had offered to settle the matter at NCLT and offered Rs 50 lakh, apart from the Rs 50 lakh paid on an earlier date, while undertaking to place a proposal to otherside, mentioning shedule of future payments.
However, Empee Distilleries reportedly failed to make payments as per the proposal and in the absence of any fresh counter to Union Bank of India’s initiative, the NCLT ordered insolvency resolution process against the company. The IRP has been asked to take over the management of the company.
“In view of the above, the tribunal observes that there is a debt due payable by the corporate debtor (Empee Distilleries) and that a default has occured which the company was responsible to pay. We are of the opinion that the applicant bank (Union Bank of India) has established that the amount in default committed by the company is a fact and it is supported by documentary evidence placed before this adjudicating athority. In this regard, the tribunal observes that the Rs 1 crore received from the company shall be excluded from the amount claimed and the bank shall proceed for the remaing amount of Rs 9.18 crore only,” said the NCLT bench comprising BSV Prakash Kumar, member-judicial and S Vijayaraghavan, member-technical.
Empee Distilleries had been making losses for the last two financial years, it reported a net loss of Rs 77 crore in FY18 while the net loss was at Rs 51.50 crore in FY17.
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Source: Financial Express