NCLT grants 3 days to Cox & Kings' former directors to submit records

The National Company Law Tribunal on Monday granted three days to suspended directors of tours and travel services firm Cox & Kings for submitting statutory information and records to the resolution professional (RP).

The RP of the tours and travel company told the tribunal that the former directors and the erstwhile auditor are not submitting statutory information and records, which is making the insolvency process difficult.

The Mumbai bench of the NCLT in October 2019 admitted an insolvency application against Cox & Kings after the tour operator defaulted on its debt obligations to the company's financial creditor, Ratan India Finance.

In November 2019, the tribunal had directed the suspended directors to cooperate with the RP.

The NCLT Mumbai has granted time till Thursday to the former directors to cooperate, and in case of a failure to do so the tribunal will lodge a police complaint.

In May and June 2019, Ratan India had approved Rs 70 crore loans to Cox & Kings, of this Rs 30 crore was disbursed by the financial creditor at an interest of 13.5 per cent per annum with a maturity date of August 31.

The loans were secured by guarantee deeds extended by the tour operator towards the financial creditor.

Ratan India had recalled its loan facility as Cox & Kings defaulted on repaying an instalment on the loan amounting to Rs 2.50 crore, which was due for repayment in June. The financial creditor filed an application under Section 7 of the Insolvency and Bankruptcy Code to recover the amount lent to the tour and travel company.

The tribunal, while allowing the application, imposed a moratorium on institution of suits or continuation of pending suits against Cox & Kings with effect from October 22, 2019, and had directed the interim resolution professional to make a public announcement of the corporate insolvency resolution process against the company.