GuarantCo Ltd has moved the Guwahati bench of the National Company Law Tribunal (NCLT) to initiate insolvency proceedings against Calcom Cement, a Dalmia Cement subsidiary, after it failed to repay the financial creditor dues of over Rs 100 crore.
According to the application filed by Mauritius-based GuarantCo Ltd, Calcom had approached it sometime in 2007, to stand as guarantor for various loan facilities which the Dalmia arm had availed from Axis Bank and HDFC Bank. The financial creditor had consented, and an agreement was drawn, in which conditions were laid under which Calcom would reimburse and indemnify GuarantCo in respect to payments to be made to the banks.
Later, Guarantco made good Calcom's loan liability to Axis Bank and HDFC Bank, upon the Dalmia group firms inability to repay a portion of its borrowings.
In its submission to NCLT, GuarantCo has alleged that Calcom had been trying to delay repaying the amount that the Mauritius-based firm had made on its behalf, and had also insisted that Guarantco issue invoices in order to get the money back. This, despite there being no such provision in the agreement for issuance of invoices, since the payment to be made by Calcom was as per an RBI approval of the payment of the guarantee amount made by GuarantCo.
The financial creditor further alleged that the last payments it received were Rs 4.76 crore each made in June and July this year.
“However, these payments are insufficient to cover the principal instalments overdue and also do not include the interest as agreed between the Financial Creditor and Corporate Debtor pursuant to the MOU, the Joint Application to RBI and also as directed by RBI,” the application filed in the NCLT read.
A Dalmia Cement spokesperson, however, said that Calcom Cement has not committed any default in making payments to GuarantCo.
“It may be noted that 100 per cent of Calcom's outstanding bank loans of over Rs 500 crore have also been paid before time. On two previous occasions, the RBI had rejected GuarantCo’s application. However after Calcom’s efforts, their third application was approved after RBI capped the payment that could be made to GuarantCo," the spokesperson said. He added that Guarantco was demanding more payments on different counts which are neither in consonance with the RBI approval, nor have been agreed by Calcom. He claimed the financial creditor was using IBC only to put pressure.
Interestingly, Calcom’s parent, Dalmia Bharat had fought bitterly with UltraTech over the acquisition of Binani Cement, which it ultimately lost in the Supreme Court.