NCLT initiates insolvency proceedings against MEP Infrastructure Developers

The National Company Law Tribunal has initiated the corporate insolvency resolution process (CIRP) against MEP Infrastructure Developers Ltd on a plea filed by the Bank of India and appointed an interim resolution professional to take control of the company.

The Mumbai bench of the NCLT admitted the plea under the IBC filed by the public sector lender, claiming default of Rs 127.86 crore.

“The fact of the existence of a financial debt and its default is officially proven. It is also established that the petition was filed within the prescribed period. Considering the facts presented to us and the fact that the corporate debtor owes a financial debt of more than Rs 1 crore, which is in default.

“This bench is of the view that in such circumstances it is imperative that the CIRP be initiated in the corporate debtor (MEP infrastructure) case,” a two-member NCLT bench said in a nine-page order dated March 28 was hired. , 2024.

The NCLT order further said that there would be a moratorium under Section 14 of the Insolvency and Bankruptcy Code (IBC), which would protect the company from lawsuits, decrees and transfers of charges from real estate firm MEP Infrastructure.

Initially, the Bank of India as a member of the MBA approved a non-fund based credit limit of Rs 150 crore in March 2010, which was later increased to Rs 175 crore.

On October 4, 2022, a recall notice was issued for all credit facilities sanctioned to MEP Infrastructure.

She expressed interest in settling the contribution outside the court and approached the financial creditor with the proposal.

However, the financial creditor did not consider the proposal because it entailed a huge haircut and there was also no clarity about the source of the funds. Subsequently, the financial creditor filed a plea before the NCLT to initiate insolvency.

The NCLT admitted the plea and appointed an IRP.

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First print: April 3, 2024 | 7:18 PM IST