Six Indian banks won their legal challenge in the London High Court to recover unpaid loans worth $2 billion, including interest, from GVK Coal Developers (Singapore) Pte Ltd and associated companies.
Judge Dame Clare Moulder presided over the trial last month and concluded that the banks had proven their case to the required standard. The banks were represented by international law firm Reed Smith and barrister Karishma Vora of 39 Essex Chambers London.
In a joint statement, Vora and Reed Smith’s Gautam Bhattacharyya said they were delighted to have secured such a resounding victory for their Indian banking clients in a matter of such commercial significance. They also said it was an honor to represent a syndicate of Indian banks that are synonymous with credibility and faith for the people of India.
The other claimants in the case included Canara Bank (London branch), ICICI Bank Ltd, Indian Overseas Bank (Corporate Branch, India), and Axis Bank Ltd.
The court heard that the case dates back to 2011 and 2014, when the banks provided loan facilities to GVK Coal Developers, which have not been repaid.
The judgment also noted that GVK was not represented in court after its adjournment application was turned down and permission for an Indian lawyer to address the court was refused.
The judge accepted the evidence of Mr Justice Gupte, an Indian law expert, on the principles of Indian law pertaining to force majeure. He also accepted that the Government of India has not declared force majeure generally in a way that could apply in relation to these contracts.
The other GVK group companies named as defendants in the case include Black Gold Ventures Pte Ltd., Cool Water Ventures Pte Ltd., Harmony Waters Pte Ltd., GVK Natural Resources Pvt Ltd., GVK Power and Infrastructure Ltd., GVK Resources (Singapore) Pte Ltd., GVK Coal Resources (Singapore) Pte Ltd., GVK Coal Infrastructure (Singapore) Pte Ltd., and GVK Coal Exploration and Production Pte Ltd.
The purpose of the 2011 and 2014 loan Facility Agreements was to provide part of the funding for the acquisition and the development of assets into working coal mines, with supporting rail and port infrastructure.