DB Realty has said that its lender LIC Housing Finance has referred the company to the Mumbai bench of the National Company Law Tribunal (NCLT).
The Mumbai-based realtor said in a recent regulatory filing that the case is listed under the caption ‘for settlement’ on October 16. DB Realty said it had availed a loan of Rs 200 crore from LIC Housing Finance in January 2010 and Rs 88 crore was disbursed. Of the disbursed loan, Rs 157.37 crore was repaid and the rest—`30.63 crore—is outstanding. “LIC has filed an application by financial creditor to initiate corporate insolvency resolution process under the code at the NCLT Mumbai against DB Realty for recovery of this outstanding money,” the company said.
It added the matter is pending admission before the NCLT. “Settlement talks are in progress between LIC and DB Realty,” it said. Bankers to the company include Oriental Bank of Commerce, ICICI Bank and HDFC Bank.
According to DB Realty’s FY17 annual report, the company has defaulted in repaying interest of Rs 13.4 crore to Reliance Capital, Rs 3 crore to ICICI Bank (principal and interest) and Rs 32 lakh in interest to Indiabulls Housing Finance. The company’s gross debt stood Rs 1,374 crore in FY17, down from Rs 1,405 crore in the previous year. It reported a net profit of Rs 1.43 crore on Rs 13.78 crore in revenues in FY17.
The Reserve Bank of India had on June 13 asked banks to refer a dozen troubled companies with a combined debt of close to Rs 2.4 lakh crore to the NCLT, following several failed attempts at loan recovery.
Under the Insolvency and Bankruptcy Code, the interim resolution professional gets 180 days to submit a restructuring plan for the company and the timeline can be extended by another 90 days. If the company fails to come up with a solution within the specified time, it would be liquidated. The resolution plan will have to be approved by the committee of creditors by a 75% majority and submitted to the NCLT.