NCLT accepts Bank of India's insolvency plea against RNA Corp

The National Company Law Tribunal (NCLT) has admitted Bank of India’s insolvency plea against realty developer RNA Corp. The bank had filed the petition under Section 7 of the Insolvency and Bankruptcy (I&B) Code, 2016, seeking the resolution process on the ground that the developer has defaulted on repayments of term loan. The public sector lender had granted a loan of Rs 75 crore to RNA Corp in October 2013 and the builder defaulted on repayment of this loan in December 2014, since then the account has been classified as a non-performing asset, the petition said. The bank has claimed total dues worth Rs 80.73 crore including the principal loan, interest, penal interest and legal expenses. The developer argued that the company was regular in making payments to the bank but due to the death of chairman Anil Kumar Aggarwal and also because of the slump in real estate market, their business was affected. The company submitted that, through its letter late 2015, that it had proposed to repay the credit facilities in instalments and accordingly, payments of Rs 7.50 crore were made by them in instalments. The Mumbai bench of NCLT, while admitting the insolvency proceedings against the company order, has kept it under moratorium with effect from November 26 till the completion of insolvency process. The bench has appointed Debashis Nanda as the interim resolution professional for the company’s resolution.