Arshiya Ltd has defaulted on its dues of over Rs.193 crore. With respect to this, Punjab National Bank had filed a request with NCLT to initiate a corporate insolvency resolution against Arshiya Ltd.
In a significant development, the National Company Law Tribunal (NCLT) in Mumbai has accepted Punjab National Bank’s request to initiate a corporate insolvency resolution process against Arshiya Ltd, a listed free zone developer and operator. The move comes after Arshiya Ltd defaulted on its dues of over Rs 193 crore. To oversee the resolution process, Nitin Vishwanath Panchal has been appointed as the resolution professional.
According to the order issued by a division bench of the NCLT consisting of Judicial member KR Saji Kumar and technical member Sanjiv Dutt, the management of Arshiya Ltd during the CIRP period will vest in the IRP or the RP as per the Insolvency and Bankruptcy Code (IBC). The order further states that the officers and managers of the company must provide all relevant documents and information to the IRP within one week.
Prior to the tribunal’s ruling, Punjab National Bank argued that Arshiya Ltd is the holding company of Arshiya Northern FTWZ Ltd (ANFL), which is a Free Trade Warehousing Zone (FTWZ) developer with operations across India. The ANFL had obtained a loan from Punjab National Bank to construct the FTWZ in Khurja, Uttar Pradesh, with Arshiya Ltd providing a corporate guarantee for the loan.
In defense, Arshiya Ltd’s counsel, Nausher Kohli, raised the issue of the limitation period, stating that the application for insolvency was filed beyond the three-year time frame as per the Limitation Act, 1963, from the alleged date of default, which was September 30, 2014, while the application was filed on August 20, 2019.
Despite the argument, the tribunal admitted Punjab National Bank’s application, citing previous rulings by the Adjudicating Authorities (NCLTs) and the National Company Law Appellate Tribunal (NCLAT) that once debt and default are established, an application under the IBC should be admitted unless it is incomplete.
During the fiscal year 2023, Arshiya Ltd reported a revenue of Rs 162.18 crore but incurred a loss of Rs 156.85 crore.
As per the company’s official website, Arshiya Ltd is the sole free zone developer operating two FTWZs and is the largest private container train operator with operations throughout India. Additionally, the company owns the only private inland container depot (ICD) with six rail loop lines.
Now a investigation be conducted and the staff dealing the account be held liable through so called lapses.necessary action will be started with no fault on only loose or routine lapses.
This is amazing
Congratulations sir