STATE BANK OF INDIA vs ENERGO INFRASTRUCTURE DEVELOPMENT CORPORATION LIMITED AND ORS on 21 April 2026

**FINAL ORDER**

1. This original application has been filed by the Applicant Banks no. 1 to 4 i.e. State Bank of India (SBI), IDBI Bank Limited, Bank of India (BOI) and Punjab National Bank (PNB) on 26.03.2019, through Mr. Kishan Lal, Assistant General Manager of Applicant Bank No. 1; Mr. Sanjeev Kumar Sarwalia, Deputy General Manager of Applicant No. 2; Mr. Pawan Kumar, Chief Manager of Applicant No. 3 and Mr. Hayat Singh Rawat, Chief Manager of Applicant No. 4, being their authorized representatives, under Section 19 of the Recovery of Debts Due to Banks and Financial Institution Act, 1993 against the Defendants no. 1 to 3 for recovery of a sum of Rs. 1361,67,36,061.21 (Rupees One Thousand Three Hundred Sixty One Crore Sixty Seven Lakh Thirty Six Thousand Sixty One and Paise Twenty One only) together with pendenteleite and future interest, as detailed below:-

<thead> <tr> <th>Applicant Bank(s)</th> <th>Amount Due (in Rupees)</th> <th>Rate of Interest (Pendenteleite and future interest a/w penal interest )</th> </tr> </thead> <tbody> <tr> <td>Applicant No. 1 / SBI<br/>With regard to Cash Credit</td> <td>Rs. 794,00,32,924.21</td> <td>@13.45% p.a. with monthly rests from 22.08.2018 besides 2% p.a. towards penal interest</td> </tr> <tr> <td>Applicant No. 2 / IDBI Bank Limited with regard to CC</td> <td>Rs. 100,51,51,419.74</td> <td>@12.90% p.a. with monthly rests from 01.03.2019 besides 2% p.a. towards penal interest</td> </tr> <tr> <td>Applicant No. 3 / BOI with regard to CC</td> <td>Rs. 102,49,11,557.95</td> <td>@13.85% p.a. with monthly rests from 12.03.2019 besides 2% p.a. towards penal interest</td> </tr> <tr> <td>Applicant No. 4 / PNB with regard to Cash Credit Accounts</td> <td>Rs. 364,66,40,159.31 due as on 21.08.2018</td> <td>@17.75% p.a. with monthly rests</td> </tr> </tbody> </table>

till the date of actual and final realization along with all costs and charges and other relief(s).

1.2 It is pertinent to note here that this OA bearing no. 485/2019 was originally filed before Ld. DRT-II, Delhi, however, in pursuance to Gazette Notification No. 4718 (E) dated 04.10.2022 issued by Government of India, Department of Financial Services, Ministry of Finance, this case file was transferred by Ld. DRT-II, Delhi to this Tribunal in October 2022 and was numbered at TA-89/2022.

2. The brief facts of the case are that the Applicant Bank no. 1 i.e. SBI is a body corporate constituted under the State Bank of India Act, 1955 carrying on its business of Banking. It is a body corporate with perpetual succession and can sue and be sued in its own name. Applicant no 1 is represented by its authorized representative, Mr. Kishan Lal, Assistant General Manager and Principal Officer of the Stressed Assets Management Branch-II at New Delhi of Applicant No. 1 who is duly authorized and empowered by the Applicant Bank to sign, verify and file the OA and documents with it and in the interest of the Applicant Bank, in connection with the application and to do all other co-related acts on behalf of the Applicant Bank for the proper prosecution of the instant OA in terms of General Regulations No. 76 & 77 of State Bank of India General Regulations 1955 made by the Reserve Bank of India in exercise of the powers conferred by Sub-Section (3) of Section 50 of the State bank of India Act, 1955 with the previous sanctions of the Central Government read with Gazette Notifications published in the Gazette of India dated 26.09.1959, 26.08.1972 and 02.05.1987.

So far as, Applicant no. 2 i.e. IDBI Bank Limited concerned, it is a Company registered under the Companies act, 1956 (1 of 1956) and a banking company within the meaning of Section 5(c) of the Banking Regulation Act, 1949 (10 of 1949) with perpetual succession and can sue and be sued in its own name. Applicant No. 2 is represented by its authorized representative, Sanjeev Kumar, Deputy General Manager of Applicant No. 2 Bank its Jhandewalan Extension, New Delhi who is duly authorized and empowered by the Applicant Bank to sign, verify and file the OA and documents with it and in the interest of the Applicant Bank, in connection with the application and to do all other co- 

related acts on behalf of the Applicant Bank for the proper prosecution of the instant OA in terms of the extant delegation of Power dated 23.11.2017.

So far as, Applicant Bank no. 3 i.e. BOI is a public-sector bank owned by the Government of India. It is also a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act 1980 with perpetual succession and can sue and be sued in its own name. Applicant no. 3 is represented by its authorized representative, Mr. Pawan Kumar, Chief Manager and Principal Officer of Applicant No. 3 who is duly authorized and empowered by the Applicant Bank to sign, verify and file the OA and documents with it and in the interest of the Applicant Bank, in connection with the application and to do all other co-related acts on behalf of the Applicant Bank for the proper prosecution of the instant OA in terms of the constituted Attorney dated 20.04.2017 of the Applicant No. 3 Bank in favour of Mr. Pawan Kumar.

So far as, Applicant Bank no. 4 i.e. PNB is concerned, it is also a public-sector bank owned by the Government of India. It is also a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act 1980 with perpetual succession and can sue and be sued in its own name. Applicant no. 4 is represented by its authorized representative, Mr. Hayat Singh Rawat, Chief Manager and Authorized Officer of Applicant No. 4 who is duly authorized and empowered by the Applicant Bank to sign, verify and file the OA and documents with it and in the interest of the Applicant Bank, in connection with the application and to do all other co-related acts on behalf of the Applicant Bank for the proper prosecution of the instant OA in terms of the Certificate of Power of Attorney dated 24.01.2018 of the Applicant No. 4 Bank in faour of Mr. Hyat Singh Rawat.

2.1 It is stated in the OA that the Defendant No. 4 is the Borrower and proforma Defendant herein, incorporated on 08.06.1989 and engaged in the business of manufacturing of material handling equipment and EPC contracting. Defendant no. 4 being Borrower availed various Credit facilities from the Applicant Banks including other Consortium Lenders from time to time. It is pertinent to point out that a Special Bench of the Hon'ble NCLT, Delhi vide its Order dated 05.09.2017 had admitted the Claim of Operational Creditors and Defendant no. 1 company under Section 9 & 10 of the Insolvency & Bankruptcy Code, 2016 (IBC 2016) and a Resolution Professional has already been appointed for the resolution of the Defendant no. 4 Company. It is pertinent to point out that as no resolution plan in pursuance of public notice issued three times was received and the maximum period of CIR process as provided under Section 12 of IBC 2016 has expired, the Committee of Creditors invoked the provisions of Section 33 and adopted Resolution unanimously recommending the Resolution Professional (RP/Liquidator) to file an appropriate Application under Section 33 of IBC 2016 before the adjudicating authority for liquidation of corporate debtor / Defendant no. 4 a/w the recommendations to appoint the RP as Liquidator and maintain status quo until the date of the Order of commencement of the Liquidation process. It is stated that Hon'ble NCLT, Principal Bench vide its order dated 21.08.2018 in Petition No. (IB)-160 (ND)/2017 allowed the Application under Section 33 of the IBC 2016 and pass an Order of Liquidation in respect of the Corporate Debtor / Defendant no. 4 and appointed the same RP to act as a Liquidator. Therefore, in compliance of the Order dated 21.08.2018, the Liquidator invited the Claims from the Creditors under the provisions of Chapter III, IBBI Regulations. In view of the aforesaid Liquidation Process, the consortium Lenders filed their respective Claim in Form D before the Liquidator. Hence, Defendant no. 4 is impleaded herein as a proforma Party / Borrower and no relief has been sought against the Defendant no. 4 in the present OA in view of Order dated 05.09.2017 and 08.08.2018 passed by Hon'ble NCLT [details given in Para 5(5.9) of the OA].

2.2 It is stated in the OA that Defendant no. 1 is a Company incorporated under the Companies Act, 1956 who stood as a Corporate Guarantor for the credit facilities granted to Defendant no. 4. Defendants no. 2 & 3 are the Personal Guarantors for the Credit facilities availed by Defendant no. 4 from the Applicant Banks / Consortium Lenders from time to time.

So far as, Defendant no. 5 is concerned, it is Proforma Party in the aforesaid OA as it was the part of Consortium Lenders, who had granted various Credit facilities to the Defendant no. 4 and are having pari passu charge over the assets of the Defendant no. 4.

2.3 It is further stated in the OA that the Defendant no. 4 availed various Credit facilities from time to time from the Applicant Bank being one of the Consortium Lenders consisting of erstwhile SBM (State Bank of Mysore), erstwhile SBH (State Bank of Hyderabad), erstwhile SBBJ (State Bank of Bikaner & Jaipur), erstwhile SBT (State Bank of Travancore), IDBI Bank Ltd., PNB (Punjab National Bank), BOI (Bank of India) and BOM (Bank of Maharashtra) wherein the erstwhile State Bank of Mysore was considered as the Lead Bank and the said Working Capital Consortium was referred as "SBM Consortium".

Vide Gazette Notification dated 22.02.2017, erstwhile SBM, SBH, SBBJ, SBT being transferor Banks have merged with the Applicant No. 1 i.e. State Bank of India (SBI) w.e.f. 01.04.2017 being subsidiaries of State Bank of India. Thus, all contracts, deeds, bonds, guarantees, agreements, assurances, powers-of-attorney and other instruments of whatever nature and working arrangements subsisting immediately before the effective date should be as of full force and effect against or in favour of the Applicant No. 1 Bank / SBI i.e. Transferee Bank and enforceable as fully and effectually as if, instead of the Transferor Banks.

It is stated in the OA that the Defendant no. 4 also approached the erstwhile SBM in the year 2007 & 2010 for grant of credit facilities, which were granted by the erstwhile SBM and the same were duly availed by the Defendant no. 4. Subsequently, the erstwhile SBM granted Working Capital Facilities through various Sanction / renewal Letters dated 26.06.2007, 04.08.2010, 12.09.2011, 18.10.2012, 27.12.2013, 27.09.2014 and 08.08.2015 and the same were availed by the Defendant no. 4.

Similarly, the erstwhile SBBJ vide Sanction Letter dated 08.03.2008 granted credit facilities, which were subsequently renewed / enhanced vide Letter dated 13.12.2012, 21.02.2014 and 09.12.2014 and the same were availed by Defendant no. 4.

Further, the Defendant no. 4 also approached the erstwhile State Bank of Hyderabad (SBH) in the year 2012 for grant of Credit Facilities, which were granted by the erstwhile SBH vide its Sanction Letter dated 19.11.2012 and the same were duly availed by the Defendant no. 4. Subsequently, the erstwhile SBH granted Working Capital facilities through various Sanction / Renewal Letters dated 18.03.2014 and 21.11.2014 and the same were availed by the Defendant no. 4.

It is stated in the OA that the Defendant no. 4 also approached the Applicant No. 2 for grant of various Credit facilities / Working Capital for its business, which was granted by the Applicant No. 2 vide its Sanction Letter dated 27.11.2012 and the same were subsequently renewed / enhanced on 21.03.2014 and 17.12.2014 and the same were duly availed by Defendant no. 4.

It is further stated in the OA that on 31.10.2015, the Consortium & Joint Lenders Forum Meeting discussed the irregularities of the accounts of the Defendant no. 4 and subsequently on 13.11.2015 a Steering Committee was formed consisting of erstwhile SBM, the Applicant Nos. 2 & 3 and the erstwhile SBBJ to monitor the status of the Defendant no. 4. However, the accounts of Defendant no. 4 were declared as NPA by the consortium Lenders.

It is also stated that the Defendant no. 4 along with Defendants no. 1 to 3 pledged their shareholding of the promoters and Group Corporate bodies in favour of the Consortium Lenders.

**A. Individual and Consortium documents regarding credit facilities granted by Applicant No. 1 Bank as part of "SBM Consortium"**

2.4 It is stated in the OA that Defendant no. 4 being the Borrower furnished the requisite Resolutions dated 06.01.2015 in respect of the various loan / credit facilities granted to Defendant no. 4 by the Applicant Banks from time to time.

Further, the Defendant no. 1 being the Corporate Guarantor furnished the requisite Resolutions dated 06.01.2015 in respect of the various loan / credit facilities granted to Defendant no. 1 by the Applicant Banks from time to time.

It is stated that initially a working Capital Consortium was formed in the year 2011 consisting of erstwhile SBM, PNB and erstwhile SBBJ to provide various Credit facilities to the Defendant no. 4 / Borrower as per its business requirements, wherein the erstwhile SBM was designated as the Lead Bank and the said consortium was called as "the SBM Consortium". Subject to the terms and conditions of the Working Capital Consortium Agreement dated 26.12.2011 as modified from time to time by various documents, the Defendant no. 4 being a Borrower had been enjoying Working Capital Facilities (credit facilities) for an aggregate sum not exceeding Rs. 625.00 Crore from the SBM Consortium. In the year 2013, SBM Consortium decided to add certain new members of the Consortium i.e. other Banks /

FIs namely the Applicant Bank / SBI, Applicant no. 2 / IDBI and the erstwhile SBH and the SBM Consortium reconstituted and fresh loan and security documents were executed after enhancing the Working Capital Limits from Rs. 625.00 Crore to Rs. 800.00 Crore. Thus, Defendant no. 4, being Borrower and Defendants no. 2 & 3 being the personal Guarantors for the said Credit facilities executed the following documents in favour of SBM Consortium:-

- (ii) Resolution dated 24.01.2013 of Defendant no. 4;

- (iii) Joint Deed of Hypothecation dated 02.02.2013;

- (iv) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 02.02.2013;

- (v) Deed of Guarantee dated 02.02.2013 executed by Defendants no. 2 & 3 in favour of the Consortium;

- (vi) Inter Se Agreement dated 02.02.2013;

- (vii) Letter of Authority to the Lead Bank dated 02.02.2013;

- (viii) Letter of Undertakings by Defendants no. 2, 3 & 4;

- (ix) Letter of Undertaking for creating Charge on Fixed Assets executed by Defendant no. 4 on 02.02.2013.

Thereafter, vide its request dated 25.10.2013, Defendant no. 4 approached the SBM Consortium for enhancement of its Credit facilities from Rs. 800.00 Crore to Rs. 991.00 Crore. Therefore, at the request of Defendant no. 4 as a Borrower and Defendants no. 2 & 3 as Guarantors, the SBM agreed to increase the aggregate limit of the Credit facilities from Rs. 800.00 Crore to Rs. 991.00 Crore on the terms and conditions mentioned in the respective Sanction Letters of the SBM

Consortium Members. Thus, Defendant no. 4 as a Borrower and Defendants no. 2 & 3 as personal Guarantors executed the following documents in favour of SBM Consortium on 11.06.2014:-

- (ii) Resolution dated 28.05.2014 of Defendant no. 4;

- (iii) Joint Deed of Hypothecation dated 11.06.2014;

- (iv) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 11.06.2014;

- (v) Deed of Guarantee dated 11.06.2014 executed by Defendants no. 2 & 3 in favour of the Consortium;

- (vi) Agreement cum Indemnity dated 11.06.2014;

- (vii) Omnibus Counter Guarantee dated 11.06.2014 for an amount of Rs. 625.00 Crore;

- (viii) Inter se Agreement dated 11.06.2014;

- (ix) Letter of Authority to the Lead Bank dated 11.06.2014;

- (x) Letter of Undertakings by Defendants no. 2, 3 & 4 dated 11.06.2014;

- (xi) Letter of Undertaking for creating a Second Charge on Fixed Assets executed by Defendant no. 4 on 11.06.2014;

- (xii) Affidavit of Assets of Defendants no. 2 & 3 as on 31.03.2014.

As aforementioned, earlier SBM Consortium under the Working Capital Consortium Agreement dated 11.06.2014 and other security documents dated 11.06.2014 executed amongst the then Consortium Member Bank comprising of the e-SBM, PNB, SBBJ, SBH, IDBI Bank and Applicant no. 1 Bank / SBI executed by the Defendant no. 4 company, has been reconstituted since the Applicant no. 1 Bank / SBI was no longer part of the Consortium and the Defendant no. 5 and the e-SBT has been inducted in the new SBM Consortium. Therefore, fresh Loan & security documents were executed afresh by the Borrower and Guarantors in favour of the SBM Consortium, wherein the e-SBM was again constituted as the Lead Bank. It is pertinent to point out that the Consortium Lenders have finally sanctioned Working Capital facilities and Term Loan to the tune of Rs. 1290.00 Crore to the Defendant no. 1 on the terms & conditions as set out in the respective sanction letters issued by the lenders from time to time, wherein Consortium Lenders have pari-passu charge over the assets of the Borrower & Guarantors in the following manner:- Amount in Rupee (Crore)

<thead> <tr> <th>S. No</th> <th>Bank</th> <th>Fund based (CC/ TL)</th> <th>Non-fund based (LC)*</th> <th>Non-fund based (BG)*</th> <th>Total Non-fund based*</th> <th>Total (FB+ NFB)</th> <th>%</th> </tr> </thead> <tbody> <tr> <td>1.</td> <td>e-SBM</td> <td>45.00</td> <td>100.00</td> <td>287.00</td> <td>387.00</td> <td>432.00</td> <td>33.49</td> </tr> <tr> <td>2.</td> <td>PNB<br/>(CC)</td> <td>36.00</td> <td>84.00</td> <td>212.00**</td> <td>296.00**</td> <td>332.00</td> <td>25.74</td> </tr> <tr> <td>3.</td> <td>e-SBBJ</td> <td>16.50</td> <td>40.00</td> <td>105.00</td> <td>145.00</td> <td>161.50</td> <td>12.52</td> </tr> <tr> <td>4.</td> <td>e-SBH</td> <td>12.00</td> <td>17.00</td> <td>90.00</td> <td>107.00</td> <td>119.00</td> <td>9.23</td> </tr> <tr> <td>5.</td> <td>IDBI Bank Ltd.</td> <td>11.00</td> <td>28.00</td>

<td>73.00</td> <td>84.00</td> <td>6.51</td> </tr> <tr> <td>6.</td> <td>BOI</td> <td>09.00</td> <td>21.00</td> <td>50.00</td> <td>71.00</td> <td>80.00</td> <td>6.20</td> </tr> <tr> <td>7.</td> <td>BOM</td> <td>08.00</td> <td>10.00</td> <td>28.50</td> <td>38.50</td> <td>46.50</td> <td>3.60</td> </tr> <tr> <td>8.</td> <td>e-SBT</td> <td>02.50</td> <td>(20.00)</td> <td>32.50</td> <td>32.50</td> <td>35.00</td> <td>2.71</td> </tr> <tr> <td colspan="2"><b>Total</b></td> <td><b>140.00</b></td> <td><b>300.00</b></td> <td><b>850.00</b></td> <td><b>1150.00</b></td> <td><b>1290.00</b></td> <td><b>100%</b></td> </tr> </tbody> </table>

\* Interchangeability within the limits as per respective sanction letters of the Bank; \*\* Amount sanctioned by PNB is Rs. 251.00 Crore. However, Total NFB Limit is restricted to Rs. 296.00 Crore Pursuant to Sanction Letters dated 27.08.2014 issued by e-SBM, 28.02.2014 & 02.01.2015 issued by the Applicant No. 4 / PNB, 09.12.2014 issued by the e-SBBJ, 21.11.2014 issued by the e-SBH, 17.12.2014 issued by the Applicant No. 3, 16.12.2014 issued by the Defendant no. 5, 01.12.2014 issued by the Defendant no. 5 and 29.11.2014 issued by the e-SBT. Defendant no. 4 as a Borrower and Defendants no. 1 to 3 as Guarantors / mortgagors executed the following documents on 08.01.2015 in favour of the SBM Consortium / Applicant Banks for the credit facilities granted to the Defendant no. 4 by the Consortium Lender Banks for an amount of Rs. 1290.00 Crore:-

- (ii) Joint Deed of Hypothecation dated 08.01.2015;

- (iii) Letter of Authority dated 08.01.2015 in favour of SBM (Lead Bank);

- (iv) Inter se Agreement dated 08.01.2015;

- (v) Confirmation of Inter se Agreement dated 08.01.2015 by the Borrower Defendant no. 4;

- (vi) Undertaking dated 08.01.2015 by the Borrower & Guarantors in favour of the Consortium Lenders;

- (vii) Deed of Guarantee dated 08.01.2015 by Defendants no. 1 to 3;

- (viii) Omnibus Counter Guarantee dated 08.01.2015;

- (ix) Agreement cum Indemnity dated 08.01.2015;

- (x) Agreement for pledge of Shares dated 08.01.2015 by Defendants no. 1 to 3 in favour of the Applicant Banks / Consortium Lenders;

- (xi) Letter of Continuity dated 08.01.2015;

- (xii) Affidavits of Assets of Defendants no. 2 & 3 as on 31.03.2015.

It is also stated that the Defendant no. 4, as a Borrower and Defendants no. 1 to 3, as Guarantors, signed and executed separate Revival Letters dated 02.01.2018 in respect of the Credit Facilities amounting to Rs. 1290.00 Crore whereby they acknowledged the debt / Credit Limits amounting to Rs. 1290.00 Crore granted by Defendant no. 4 by the SBM Consortium for the purpose of Section 18 of the Limitation Act, 1963.

It is also stated in the OA that the said credit facilities are secured in favour of Consortium Lenders by various securities viz. mortgage of properties of Defendant no. 4, hypothecation of current assets / stocks, pledge of shares of Defendant no. 4 etc.[details given in Para 5(5.27) of the OA].

It is further stated that the Applicant Banks vide their several letters called upon Defendant no. 4 to regularize the accounts but Defendant No. 4 failed to do so.

Defendant no. 1 time and again acknowledged their liability to pay the outstanding amount to the Consortium Lenders in their duly audited Balance Sheets including as on 31.03.2018.

**Claim of the Applicant No. 1 Bank**

It is stated in the OA that the Defendant no. 1 duly availed the aforesaid Loan / Credit facilities granted to them by the Consortium Lenders and signed and executed Balance Confirmation Letters dated 31.03.2016 and 31.03.2017 confirming the outstanding Balance due and payable by them to the Consortium Lenders.

It is stated in the OA that the Applicant no. 1 Bank filed its Claim in Form D under Regulation 18 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Person) Regulation, 2016 on 19.09.2018 for an amount of Rs. 762,51,54,760.00 as on 19.09.2018 before the Liquidator appoint by Ld. NCLT, Principal Bench, Delhi.

It is also stated that the Applicant Bank no. 1 vide its Recall Notice dated 24.12.2018 recalled the corporate guarantee provided by the Defendant no. 1 and the personal guarantees provided by the Defendants no. 2 & 3 for the Credit Facilities granted to Defendant no. 4 for an amount of Rs. 794,00,32,924.21 as on 15.12.2016, however, the Defendants no. 1 to 3 failed to pay the said amount.

At present the following Letter of Credit / Bank Guarantees for an amount of Rs. 20,94,54,718.00 has already been issued by the Applicant no. 1 Bank in favour of various Beneficiaries on behalf of Defendant no. 4 at its request but the same have not been invoked by the Beneficiaries yet. Hence, the Applicant no. 1 bank reserves its rights to claim the said amounts besides interest, charges, expenses etc. as and when he aforesaid Bank Guarantees are invoked by the Beneficiaries and the Applicant No. 1 Bank remits the payment thereof to the Beneficiaries.

It is also stated that consequent to the sanction of the aforesaid limits by the e-SBM, e-SBH and e-SBBJ and e-SBT, the accounts of the aforesaid Banks were declared as NPA by the respective Banks in terms of guidelines issued by RBI from time to time. These accounts were subsequently transferred to the Stressed Assets Management Branch-I by the respective branches of the said Banks after their merger with the Applicant Bank for recovery action. Now the Applicant Bank at its Stressed Assets Management Branch-I, Delhi is keeping and maintaining all entries of Debits and Credits, which correctly made therein by the Applicant Bank in their regular, ordinary and usual course of banking business.

Now as per books of accounts maintained by the Applicant no. 1 Bank (SBI) in their regular course of business the following amounts are due and payable by the Defendants to the Applicant no. 1 Bank / SBI besides accrued interest :- Applicant Bank No. 1

<table> <tbody> <tr> <td>e-SBM</td> <td>Cash Credit A/c</td> <td>Rs. 439,12,24,041.27</td> </tr> <tr> <td>e-SBBJ</td> <td>Cash Credit A/c</td> <td>Rs. 208,43,52,282.66</td> </tr> <tr> <td>e-SBH</td> <td>Cash Credit A/c</td> <td>Rs. 107,95,50,134.09</td> </tr> <tr> <td>e-SBT</td> <td>Cash Credit A/c</td> <td>Rs. 38,49,06,476.19</td> </tr> <tr> <td colspan="2"><hr/>Grand Total</td> <td><hr/>Rs. 794,00,32,924.21<hr/></td> </tr> </tbody> </table>

**B. Individual and Consortium documents regarding credit facilities granted by IDBI Bank Limited (Applicant No. 2) as part of "SBM Consortium"**

2.5 It is stated in the OA that Defendant no. 4 approached the Applicant No. 2 Bank to avail various credit facilities / Working Capital Facilities amounting to Rs. 50.00 Crore. The Applicant No. 2 vide its Sanction Letter dated 27.11.2012 granted the Working Capital facilities of Rs. 50.00 Crore.

The aforesaid Credit Facilities were enhanced / renewed by the Applicant No. 2 bank from time to time at the request of the Defendants no. 1 to 4 vide subsequent Sanction Letters dated 21.03.2014 and lastly on 17.12.2014.

The Applicant No. 2 Bank vide its Sanction Letter dated 17.12.2014 granted / sanctioned / renewed the Credit facilities amounting to Rs. 85.00 Crore to the Defendant no. 4 on the terms and conditions mentioned in the Sanction Letter, which were duly accepted by the Defendants no. 1 to 4. The said credit facilities were sanctioned / renewed by the Applicant no. 2 Bank in the following manner:-

<thead> <tr> <th>Nature</th> <th>Sanctioned Amount (Rs. in Crore)</th> </tr> </thead> <tbody> <tr> <td>Cash Credit (CC)</td> <td>12.00</td> </tr> <tr> <td><b>Fund Based ceiling</b></td> <td><b>12.00</b></td> </tr> <tr> <td>Bank Guarantee (BG)</td> <td>45.00</td> </tr> <tr> <td>Letter of Credit (both Inland &amp; Foreign)</td> <td>28.00</td> </tr> <tr> <td>TCBG-(sub limit of ILC / FLC)</td> <td>(18.00)</td> </tr> <tr> <td>LER (sub limit of NFB Limit)<br/>(within the Letter of Guarantee Limit)</td> <td>(10.00)</td> </tr> <tr>

<td><b>73.00</b></td> </tr> <tr> <td><b>Total</b></td> <td><b>85.00</b></td> </tr> </tbody> </table>

It is stated that Defendant no. 4 as a Borrower and Defendants no. 1 to 3 as Guarantors / mortgagors executed various documents on 08.01.2025 in favour of the SBM Consortium / Applicant no. 2 Bank for the credit facilities granted by Defendant no. 4 by the Consortium Lender Banks for an amount of Rs. 1290.00 Crores.

It is stated in the OA that the Applicant no. 2 Bank filed its Claim in Form D under Regulation 8 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Person) Regulation, 2016 on 19.09.2018 for an amount of Rs. 91,60,42,368.00 as on 15.09.2018 before the Resolution Professional / Liquidator appoint by Ld. NCLT, Principal Bench, Delhi vide its Order dated 08.08.2018 in Petition No (IB)-160 (ND)/2017.

It is also stated that the Applicant Bank no. 2 vide its Recall Notice dated 31.12.2018 recalled the corporate guarantee provided by the Defendant no. 1 and the personal guarantees provided by the Defendants no. 2 & 3 for the Credit Facilities granted to Defendant no. 4 for an amount of Rs. 97,11,00,000/- as on 20.12.2018, however, the Defendants no. 1 to 3 failed to pay the said amount.

It is further stated that the Defendant no. 4 duly availed the aforesaid Loan / Credit facilities granted to them by Applicant no. 2 Bank (IDBI Bank Limited) and signed and executed Balance Confirmation confirming the outstanding Balance due and payable by them to Applicant No. 2 Bank (IDBI Bank Limited).

It is pertinent to note here that a Bank Guarantee for an amount of Rs. 3,00,00,000/- has already been issued by the Applicant no. 2 Bank in favour of a Beneficiary on behalf of Defendant no. 4 at its request but the same has not been invoked by the Beneficiaries yet. Hence, the Applicant no. 2 bank reserves its rights to claim the said amounts besides interest, charges, expenses etc. as and when the aforesaid Bank Guarantees are invoked by the Beneficiaries and the Applicant No. 2 Bank remits the payment thereof to the Beneficiaries.

It is also stated that Defendants no. 1 to 3 acknowledged subsistence of the liability in respect of the aforesaid credit facilities granted by the Applicant no. 2 by executing confirmation of balances and revival letters and other documents from time to time. But despite repeated requests, Defendants no. 1 to 3 have failed and neglected to repay the said dues / outstanding liabilities. It is stated that Defendants no. 1 to 3 are still liable to pay interest at the agreed rate of interest i.e. 13.50% p.a. with monthly rests as regards the Cash Credit account.

Now as per books of accounts maintained by the Applicant no. 2 Bank (IDBI Bank Limited) in their regular course of business, a sum of Rs. 100,51,51,419.74 (as on 01.02.2019) is due and payable by the Defendants to the Applicant no. 2 [details given in Para 5(5.50) of OA].

**C. Individual and Consortium documents regarding credit facilities granted by Bank of India (Applicant No. 3) as part of "SBM Consortium"**

2.6 It is stated in the OA that Defendant no. 4 approached the Applicant No. 3 Bank to avail various credit facilities / Working Capital Facilities amounting to Rs. 80.00 Crore. The Applicant No. 3 vide its Sanction Letter dated 30.09.2014 granted the Working Capital facilities of Rs. 80.00 Crore.

The aforesaid Credit Facilities granted vide Sanction Letter dated 30.09.2014 were subsequently modified by the Applicant no. 3 Bank vide subsequent Sanction Letter dated 16.12.2014.

The Applicant No. 3 Bank vide its Sanction Letter dated 30.09.2014 & 16.12.2014 sanctioned / renewed the Credit facilities amounting to Rs. 80.00 Crore to the Defendant no. 4 on the terms and conditions mentioned in the Sanction Letter, which were duly accepted by the Defendants no. 1 to 4. The Applicant no. 3 Bank sanctioned / renewed the Cash Credit Limits vide its Sanction Letter dated 30.09.2014 in the following manner:-

<thead> <tr> <th>Nature</th> <th>Sanctioned Amount<br/>(Rs. in Crore)</th> </tr> </thead> <tbody> <tr> <td>Cash Credit (Hypothecation of Stock &amp; Book Debts upto 180/120 days for PSUs/Non PSUs)</td> <td>10.00</td> </tr> <tr> <td>OD against supply bills<br/>(Maximum tenor 120-days)</td> <td>10.00</td> </tr> <tr> <td>EPC</td> <td>(2.50)</td> </tr> <tr> <td><b>Total FBWCL</b></td> <td><b>20.00</b></td> </tr> <tr> <td>LC/(I/F) (DP/DA-180 days)</td> <td>25.00</td> </tr> <tr> <td>Buyers Credit (within LC Limit)</td> <td>(15.00)</td> </tr> <tr> <td>BG (I/F) (P/F)</td> <td>55.00</td> </tr> <tr>

<td><b>80.00</b></td> </tr> <tr> <td><b>Total</b></td> <td><b>80.00</b></td> </tr> </tbody> </table>

It is stated that Defendant no. 4 as a Borrower and Defendants no. 1 to 3 as Guarantors / mortgagors executed various documents on 08.01.2015 in favour of the SBM Consortium / Applicant no. 3 Bank for the credit facilities granted by Defendant no. 4 by the Consortium Lender Banks for an amount of Rs. 1290.00 Crores.

It is stated in the OA that the Applicant no. 2 Bank filed its Claim in Form D under Regulation 8 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Person) Regulation, 2016 on 03.09.2018 and revised on 19.02.2019 for an amount of Rs. 94,39,74,469.86 as on 21.08.2018 before the Resolution Professional / Liquidator appointed by Ld. NCLT, Principal Bench, Delhi vide its Order dated 08.08.2018 in Petition No (IB)-160 (ND)/2017.

It is stated that Defendants no. 1 to 3 acknowledged subsistence of the liability in respect of the aforesaid credit facilities granted by the Applicant no. 3 by executing confirmation of balances and revival letters and other documents from time to time. Despite repeated requests Defendants no. 1 to 3 have failed and neglected to repay the said dues / outstanding liabilities. It is stated that Defendants no. 1 to 3 are still liable to pay interest at the agreed rate of interest i.e. 13.85% p.a. with monthly rests as regards the Cash Credit Account.

Now as per books of accounts maintained by the Applicant no. 3 Bank (Bank of India) in their regular course of business, a sum of Rs. 102,49,11,557.95 (as on 11.03.2019) is due and payable by the Defendants to the Applicant no. 3 [details given in Para 5(5.60) of OA].


**D. Individual and Consortium documents regarding credit facilities granted by Punjab National Bank (Applicant No. 4) as part of "SBM Consortium"**

2.7 It is stated in the OA that Defendant no. 4, as a borrower and Defendants no. 2 & 3 as guarantors approached the Applicant No. 4 Bank to avail / enhance various credit facilities from time to time. The Applicant Bank vide its Sanction Letter dated 16.08.2010 enhanced the Working Capital Limit from 10.75 Crore to Rs. 21.50 Crore and NFB Limit from Rs. 5.00 Crore to Rs. 129.00 Crore, which were duly availed by the Defendant no. 4.

The aforesaid Credit Facilities were enhanced / renewed by the Applicant No. 4 bank at the request of the Defendants no. 1 to 4 vide subsequent Sanction Letter dated 21.09.2010.

In the year 2011, the Applicant Bank no. 4 joined the Consortium lenders with e-SBM as the Lead Bank called as the "SBM Consortium" and sanctioned / renewed / enhanced the credit facilities being availed by the Defendant no. 4 company from time to time, inter-alia vide sanction letters dated 15.12.2011, 12.03.2013, 28.02.2014 and lastly on 02.01.2015.

In the year 2012, the Applicant Bank no. 4 at the request of the Defendant no. 4 company sanctioned Term Loan Facility for a sum of Rs. 28.00 Crore for purchase of building and construction in favour of Defendant no. 4 company which was separate from the consortium.

The above said Term Loan was secured by the equitable mortgage of immovable property bearing Industrial Plot & Building at 442, Udyog Vihar, Phase-I, Gurgaon, Haryana upon which the Applicant Bank no. 4 has the 1^st charge. It is pertinent to point out that the Applicant No. 4 Bank is not relinquishing its charge over the said property in favour of the liquidator appointed in respect of the Defendant no. 4 company and a separate OA is being filed against the company in respect of the said facility.

It is further stated that Applicant no. 4 Bank vide its Sanction Letter dated 02.01.2015 granted / sanctioned / renewed the Credit facilities amounting to Rs. 334.70 Crore to the Defendant no. 4 on the terms and conditions mentioned in the Sanction Letter, which were duly accepted by the Defendants no. 1 to 4. The Applicant No. 4 Bank sanctioned / renewed the Credit Limits vide its Sanction Letter dated 02.01.2015 in the following manner:-

<thead> <tr> <th>Nature</th> <th>Sanctioned Amount<br/>(Rs. in Crore)</th> </tr> </thead> <tbody> <tr> <td>CC(M) &amp; C(BD)</td> <td>38.70</td> </tr> <tr> <td><b>Fund Based ceiling</b></td> <td><b>38.70</b></td> </tr> <tr> <td>Letter of Guarantee (both Inland &amp; Foreign)</td> <td>251.00</td> </tr> <tr> <td>ILC/FLC (DA/DP)</td> <td>84.00</td> </tr> <tr> <td>Buyers Credit / LOC / LOU (within the Letter of Guarantee Limit)</td> <td>(50.00)</td> </tr> <tr>

<td><b>335.00</b></td> </tr> </tbody> </table>

It is also stated that the Sanction Letter dated 02.01.2015 stipulated a condition that the overall exposure under NFB Limit should not exceed Rs. 296.00 Crore.

It is stated that Defendant no. 4 as a Borrower and Defendants no. 1 to 3 as Guarantors / mortgagors executed various documents on 08.01.2025 in favour of the SBM Consortium / Applicant no. 2 Bank for the credit facilities granted to Defendant no. 4 by the Consortium Lender Banks for an amount of Rs. 1290.00 Crores.

It is stated in the OA that the Applicant no. 4 Bank filed its Claim in Form D under Regulation 8 of Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Person) Regulation, 2016 on 02.11.2018 for an amount of Rs. 448,79,17,003.35 (revised Rs. 437,82,22,329.35) as on 21.08.2018 before the Resolution Professional / Liquidator appoint by Ld. NCLT, Principal Bench, Delhi vide its Order dated 08.08.2018 in Petition No (IB)-160 (ND)/2017.

It is also stated that the Applicant Bank no. 4 vide its Recall Notice dated 01.01.2019 recalled / invoked the corporate Guarantee provided by the Defendant no. 1 and the personal guarantees provided by the Defendants no. 2 & 3 for the Credit Facilities granted to Defendant no. 4 for an amount of Rs. 448,79,17,003.35 (revised Rs. 437,82,22,329.35) as on 21.08.2018, however, the Defendants no. 1 to 3 failed to pay the said amount.

It is stated that at present the following Letter of Credit / Bank Guarantee for an amount of Rs. 44,07,39,193.00 has already been issued by the Applicant no. 4 Bank in favour of a Beneficiary on behalf of Defendant no. 4 at its request but the same have not been invoked by the Beneficiaries yet. Hence, the Applicant no. 4 bank reserves its rights to claim the aforesaid amounts besides interest, charges, expenses etc. as and when the aforesaid Bank Guarantees are invoked by the Beneficiaries and the Applicant No. 4 Bank remits the payment thereof to the Beneficiaries.

Now as per books of accounts maintained by the Applicant no. 4 Bank (PNB) in their regular course of business, a sum of Rs. 364,66,40,159.31 (as on 21.08.2018) (in 22 Accounts) is due and payable by the Defendants to the Applicant No. 4 [details given in Para 5(5.75) of OA].

2.8 Since, the Defendants no. 1 to 4 failed to maintain financial discipline nor they paid the dues of the Applicant Banks / SBM Consortium members. Hence, the Applicant Banks no. 1 to 4 have been compelled to file this Application before this Tribunal.

3. Notices of this O.A. were issued to the Defendants and Defendants no. 1 to 3 appeared through Counsel and filed their common WS along with Counter Claim.

3.1 So far as, Defendant no. 4 / Principal Borrower, no relief is claimed by the Applicant Banks qua said Defendant as Defendant no. 4 has gone into liquidation as per Order passed by Ld. NCLT, New Delhi.

3.2 So far as, Defendant no. 5 / BOM is concerned, it did not chose to appear through Counsel nor filed any WS.

It is pertinent to note here that no relief is claimed by the Applicants no.1 to 4 qua Defendant no. 5 since it is a Proforma Defendant as it was the part of the Consortium Lenders from time to time and it had granted various Credit facilities to the Defendant no. 4 and is having pari-passu charge over the assets of the Defendant no. 4.

4. In their common WS, Defendants no. 1 to 3 have taken following main objections:-

- (i) Defendants no. 1 to 3 have raised an objection that the documents placed on record by Applicant no. 1 do not authorize persons holding the rank of AGM to sign, file, verify and institute the present proceedings on behalf of Applicant no. 1. In addition, no documentary proof has been placed on record to establish that Sh. Krishan Lal is indeed an AGM of the Applicant no. 1. Further more, no power of attorney or board resolution has been placed on record to support the authorization of Sh. Hayat Rawat to sign, file, verify and institute the present proceedings for and on behalf of the Applicant no. 4. Thus, in the absence of such authorization, the present proceedings have not been validly instituted and are liable to be dismissed *in limini*, at lease qua Applicants no. 1 and 4.

- (ii) Next plea taken by the Defendants no. 1 to 3 is that the amounts claimed by the Applicants in the OA are incorrect which are neither due nor payable to the Applicants. It is stated that the computation of the alleged monies due to the Applicants is inconsistent with their respective claims qua the Principal Debtor i.e. Defendant no. 4. Moreover, the computation is replete with errors arising out of inclusion of amounts which have not ever been paid by the Applicants and are unlikely to be paid, being against discharged bank guarantees and letters of credit. Thus, there is no sanctity to the claims raised in the OA. It is also stated that despite it being trite law that Banks are not entitled to impose 

interest on accounts which have been rendered non-performing [breakup of the Inadmissible Interest for the respective Applicants is given in Para 8 at Page 4 of the WS]. It is also stated that at the time when the respective accounts were declared as NPA, the Applicants were holding monies in the nature of margin money to the tune of Rs. 106,74,49,295/-, however, while computing the claims against the Answering Defendants, the Applicants have not provided for adjustment of the said amounts [details given in Para 9 at page 4 of the WS]. Even otherwise, the Defendants no. 2 & 3 not having been incharge of Defendant no. 4 since 05.09.2017 (when its Board of Directors were suspended upon commencement of corporate insolvency resolution process), the answering defendants cannot be held responsible for the financial exposure of the Applicants undertaken thereafter since 05.09.2017. Such an attempt is untenable in law, more so when the Applicants themselves have been responsible for the affairs of Defendant no. 4 through its Resolution Professional and subsequently, the Liquidator.

(iii) Next objection of Defendants no. 1 to 3 is that despite availability of margin money and an option to renew previously issue Bank Guarantees, instead of renewing the same (upon request of the beneficiary), encashed bank guarantees to the tune of Rs. 116.61 crore, thereby exacerbating the cashflow condition of EEPL, plunging in further illiquidity. The applicants having increased their exposure by imprudent and arbitrary conduct, cannot seek to recover the same from the answering Defendants who had time and again requested the Applicants to renew the bank guarantee instead of encashing the same. Accordingly, an amount of Rs. 116.61 crore must be deducted from the alleged claim of the Applicants in the manner, as detailed in Para 11 at page 6 of the WS.

- (iv) Defendants no. 1 to 3 have also raised an objection that the Applicants ought not to be permitted to place reliance on the so-called Revival Letter dated 02.01.2018, which the answering Defendants were coerced to execute under threat of proceedings under the IBC 2016 for non-cooperation with the Resolution Professional. It is also stated that the answering Defendants were required to sign on the dotted lines and standard form contracts, with no scope for negotiations. The Applicants, being the members of the Committee of Creditors, having decided to seek liquidation of Defendant no. 4, which prayer was granted by Ld. NCLT vide its Order dated 20.08.2018, cannot seek to derive any benefits therefrom, especially for alleging that such order of liquidation resulted in creation of a cause of action in their favour to proceed against the answering Defendants. Further more, invocation of corporate and personal guarantees issued by the answering Defendants was grossly time barred. Apart, admittedly, Applicant no. 3 did not invoke the corporate and personal guarantees issued by the answering Defendants ahead of filing of present proceedings. Hence, there is no cause of action available for commencement and continuation of present proceedings.

In the light of above, it has been prayed to dismiss the present OA with exemplary costs.

4.1 Further more, Defendants no. 1 to 3 have also filed a Counter Claim stating therein that the present Counter Claim is being filed by the Defendants no. 1 to 3, who have been proceeded against in their capacity as the guarantors of the credit facilities advanced by the Consortium of Bank to Energo Engineering Products Ltd. (EEPL) (presently in liquidation). It is stated that Counter Claimant no. 1 / Defendant no. 1 was a corporate guarantor to the facilities advanced by the SBM Consortium to EEPL and Sh. Dinesh Bahadur Singh, Director of Counter Claimant no. 1 has been authorized to institute the present Counter Claim. It is also stated that Counter Claimant no. 2 & 3 / Defendants no. 2 & 3 are the promoters of EEPL.

In the Counter Claim, Counter Claimants have given details of borrower company, availment of loan facilities from the SBM Consortium from time to time. It is also stated that since 2014 as the power and infrastructure companies were faced with financial constraints, they started rejecting components / materials and refused to grant completions to avoid payment obligations. This in turn resulted in stalling of projects, inventory pileups and time and cost overruns.

It is also stated in the Counter Claim that at the behest of SBM / Consortium Leader, the banks refused to allow EEPL to take benefit of the sanctioned limits. SBM itself refused to 

release the enhanced limits, despite sanctioning the same – pushing EEPL into a spiral of liquidity, forcing the company into breaching its financial obligations to its trade creditors as well as other banks.

It is further stated that at the time of first devolvement of the Letters of Credit in August 2015, EEPL had current assets in the form of stocks and receivables to support these borrowings, besides cash margin of more than Rs. 100.0 Crore and usable fixed assets of Rs. 75.0 crore (approx.). However, in the absence of support from the Banks and their refusal to release funds and issue BGs (despite availability of margin), a domino effect was felt on the projects, which started falling one by one, BGs started getting invoked, clients held back payments and resorted to cancellation of contracts, direct payment to suppliers / sub-contractors, operate risk and cost, black listing etc. and the business fell apart.

Moreover, a Joint Lenders Forum (JLF) was formed on 17.10.2015 in which the Company was advised to submit a Corrective Action Plan (CAP) and at the same time Dun & Bradstreet was appointed to conduct a TEV and in November 2015, EEPL submitted a broad CAP but no decision was conveyed on the CAP. Thereafter, abandoning the CAP with impunity, the SBM Consortium decided to explore the possibility of Strategic Debt Restructuring but same could not be marshalled by the SBM Consortium.

It is also stated that SBI Caps proposed a CDR Schemed basis the TEV Study done and based on viable TEV Study Report, SBI Caps presented a Restructuring Scheme in the JLF meeting held on 24.08.2016, however, no action on the same was taken as the JLF now postponed all decisions to await the report of an investigating audit.

Relatively, at this stage, EEPL had orders worth Rs. 1826.0 crore which it was already executing. Finally, despite these circumstances, on 05.09.2017, at the behest of a trade creditor, the NCLT, New Delhi commence CIRP against EEPL and the Board of Directors were suspended. The CIRP finally culminated in an order of liquidation dated 21.08.2018, denuding the capital investment of the Counter Claimants, apart from the future of a business they had built with their efforts over two decades.

It is stated that between November 2015 to May 2016, the refusal of the SBM Consortium Banks to issue BGs despite availability of Non-Fund Based Margins resulted in loss of revenue to the tune of Rs. 451.46 crore (approx.). It is mainly contended that in November 2015, EEPL was awarded a Contract for Augmentation of Raw Material Preparation Area by the Rashtriya Ispat Nigam Ltd. for Rs. 109.89 crore. For the purpose of execution of the said project, EEPL was required to subject performance bank guarantee in favour of the employer, however, on account of the refusal by the SBM Consortium to issue BGs, EEPL was unable to comply with the requirement of submitting performance bank guarantee and the employer cancelled the order. Similarly, in March 2016, EEPL was awarded a Contract for Strengthening, Improvement, Renovation & Augmentation of Distribution System of scheduled works in Electric Supply Area, Jamshedpur, by Jharkhan Bijli Vitran Nigam Ltd. for value of Rs. 279.52 crore. Again, on account of the refusal by the SBM Consortium to issue BGs, EEPL was unable to comply with the requirement of submitting performance bank guarantee and the employer cancelled the Order. [details given in Para 22 & 23 at page 33-34 of WS-cum-Counter Claim].

Again in May, 2016, for the same reasons, a contract issued by the Rashtriya Ispat Nigam Ltd. for Supply of Wheel on Boom Reclaimer for Rs. 10.14 crore was cancelled and the Earnest Money Bank Guarantee was invoked, created further cash flow problems. This resulted in a loss of revenues to the tune of Rs 10.14 crore for EEP as well in a loss of profit to the tune of Rs. 1.52 Crore [details given in Para 24 at page 35 of WS-cum-Counter Claim].

For the same reasons, Lilamal Joint Stock Exchange (Vietnam) cancelled an Order worth Rs. 52.0 Crore for an Ash Handling System at the Song Hua 1 Thermal Power Project, Vietnam which resulted in a loss of revenues to the tune of Rs 52.0 crore for EEP as well in a loss of profit to the tune of Rs. 7.8 Crore and loss of investment to the tune of Rs. 2.03 crore already undertaken by EEPL [details given in Para 25 at page 35 of WS-cum-Counter Claim].

It is stated that despite the fact that EEPL continued to perform its contractual obligations and ensured successful completion of projects, which resulted in discharge of guarantee to the tune approximately of RS. 106.0 crore since September 2015.

As a result of the SBM Consortium's conduct, EEPL suffered a loss of revenue to the tune of Rs. 451.46 Crore (approx.) and a consequent loss of profit to the tune of Rs. 67.719 Crore (approx.). Accordingly, the SBM Consortium is liable to compensate Counter Claimant (and EEPL) for such loss of profit.

Further, the SBM Consortium despite availability of margin money and an option to renew previously issued BGs, instead of renewing the same (upon request of the beneficiary), encashed bank guarantees to the tune of Rs. 116.61 crore, thereby exacerbating the cashflow conditions of EEPL, plunging it further liquidity. Faced with lack of support from the bankers of EEPL, the beneficiaries (i.e. project employers of EEPL) started retention of due payments, and on occasion terminated contracts. The SBM Consortium, for reasons best known to itself, refused to treat EEPL as a "going concern" despite it executing orders worth hundreds of crores and employing thousand personnel thus jeopardizing their own investment.

Apart from the above, as a consequence of the SBM Consortium's actions and inactions, Bank Guarantees to the tune of Rs. 210.26 crore issued by EEPL ended up getting invoked.

As a consequence of the actions and inactions of the SBM Consortium, EEPL also suffered loss investment to the tune of Rs. 4.36 crore upon cancellation of 11MWp Solar Power Project at RRECL Bhadra Power Park, Rajasthan. The Project would have resulted in profits to the tune of Rs. 6.43 crore. Similarly, investment to the tune of Rs. 2.34 crore was washed out when the SBM Consortium refused to support the 21 MW Hydro Power Project at Patnazi, which had been awarded to EEPL. This resulted in a loss of profits to the tune of Rs. 87.0 Crore (approx.). Being an attractive project, was open to the SBM Consortium to hire and sell the same off to generate funds for the company, however, for reasons best known to the banks, they refused to do so.

It is stated that the SBM Consortium Banks arbitrarily and without cause, red-flagged the accounts of EEPL (despite absence of any irregularity), refused operations of the same and even after decision to allow use of funds, continued to deny access to the same. This resulted impacted EEPL's ability to manage its operations as well as financial commitments to its creditors, resulting in defaults in the continuation of its projects, which ended up getting short closed / cancelled.

Relevantly, the value of the investment of the Counter Claimants in EEPL as compared to ICICI Securities Ltd. and Axis Capital was to the tune of Rs. 1313.48 crore (being pro-rata value of 93.82% shares held by the Counter Claimant), which stands denuded solely on account of the uncooperative and arbitrary conduct of the SBM Consortium, which had a domino effect on the finances and operations of EEPL. The SBM Consortium itself having led to the deterioration and downfall of the company and wiping out the value of the Counter Claimants' investment in EEPL is liable to compensate the Counter Claimants for the same. Accordingly, the SBM Consortium is liable to pay to the Counter Claimants a sum of Rs. 1313.48 Crore being the value of their investment, which stands denuded to NIL as on date.

It is further stated that the Counter Claimants are filing all the documents as per list of the enclosures which includes correspondence done between Borrower Company and Consortium Members and / or other power distribution companies / authorities etc.

Now request is made to direct the Applicants and the Defendant no. 5 to jointly and severally pay a sum of Rs. 1483.36 crore to the Counter Claimants together with interest pendentelite computed from 21.08.2018 (when the Defendant no. 4 was directed to be liquidated) and future interest @12% p.a. till the date of actual realization along with all costs of the present proceedings.

5. Rejoinder to the WS of Defendants no. 1 to 3 has also been filed by the Applicant Banks denying the allegations levelled against them and reiterating the averments made in the OA.

6. Applicant Banks have also filed Reply to Counter Claim wherein it is stated that the Defendant no. 4 is a Borrower and impleaded in the present OA as a proforma party as Liquidation Process has already been started by NCLT. Therefore, submissions on behalf of Defendant no. 4 can be made by the Liquidator only, representing Defendant no. 4 and not by Defendants no. 1 to 3. It is pertinent to point out that Defendant no. 4 has not filed any Counter Claim and WS in the OA filed by the Applicant Bank despite service. Therefore, Counter Claim filed by the Defendants no.1 to 3 on behalf of Defendant no. 4 is without any merits and cannot be taken any cognizance by this Hon'ble Tribunal.

It is stated that there is clear admission of availing of financial facilities as mentioned in the OA by the Defendants no. 1 to 3 and the Guarantees extended to the Applicant Banks for the credit facilities granted to Defendant no. 4.

Further, Defendant no. 2, who was the authorized Signatory and Managing Director / Promoter of Defendant no. 4 at the relevant time has not made any denial or objection with regard to signing of loan-cum-security documents including mortgage of properties. Moreover, execution of the personal guarantee in favour of the Applicant Banks / Consortium Lenders are not denied by the Defendants no. 1 to 3 for the Credit facilities granted to Defendant no. 4.

It is further stated that the liability of Defendant no. 4 has already been crystallized and the Liquidation process of Defendant no. 4 is under consideration by the NCLT.

Even otherwise, the Hon'ble Supreme Court in the case of SBI Vs. V. Ramakrishnan (2018) (17) SCC 394, held that the guarantor cannot be relieved from making payment by virtue of Section 133 of the Contract Act even if the debt is varied under the resolution plan as the resolution plan is binding on the guarantor as well. Thus, the Defendants no. 1 to 3 are jointly and severally liable for the amount claimed by the Applicant Banks qua the credit facilities granted to Defendant no. 4 (Borrower Company).

It is also stated that the Consortium Lenders have to follow various banking norms and RBI guidelines issued from time to time. So far as, question of request(s) made by Defendant no. 4 to the SBM Consortium from to time are concerned, same could not be processed due to financial risk involved with the Company and the Borrower company was not routing the sale proceeds through the accounts of the Consortium Lenders as mentioned in the TRA report annexed with the reply to the counter claim. Further more, Bank Guarantees were encashed by the beneficiaries of the Bank Guarantees and not by the consortium Lenders. Once, the BGs are invoked by the beneficiaries, the Consortium Lenders have no other option but to pay the BG amount to the beneficiaries as per law already settled by Hon'ble Supreme Court as the Bank Guarantees are unconditional and are payable on demand. Hence, Consortium Lenders have every right to debit it in the account of the Borrower company.

In the light of above, it has been prayed to dismiss the WS and Counter Claim with heavy costs.

7. Defendants no. 1 to 3 have also filed Rejoinder to the Reply to Counter Claim filed by the Applicant Banks.

8. To prove their case, the Applicant Bank No. 1 / SBI leads its evidence by filling the affidavit of Sh. Kishan Lal, Assistant General Manager of the Applicant bank.

8.1 Sh. Kishan Lal, Officer of Applicant Bank No. 1 / SBI has placed reliance upon various documents viz.

- (i) General Regulations No. 76 & 77 of State Bank of India General Regulations 1955 made by the Reserve Bank of India as well as Gazette Notifications published in the Gazette of India dated 26.09.1959, 26.08.1972 and 02.05.1987 (A1W1/1 to A1W1/4);

- (ii) Gazette Notification dated 22.02.2017 whereby erstwhile SBM, SBH, SBBJ, SBT were merged with SBI w.e.f. 01.04.2017 (A1W1/5);

- (iii) Sanction / renewal Letters dated 26.06.2007, 04.08.2010, 12.09.2011, 18.10.2012, 27.12.2013, 27.09.2014 and 08.08.2015 issued by e-SBM to Defendant no. 4 (A1W1/6 to A1W1/12);

- (iv) Sanction / renewal Letters dated 13.12.2012, 21.02.2014 and 09.12.2014 issued by e-SBBJ to Defendant no. 4 (A1W1/13 to A1W1/15);

- (v) Sanction / Renewal Letters dated 18.03.2014 and 21.11.2014 issued by e-SBH to Defendant no. 4 (A1W1/16 & A1W1/17);

- (vi) Resolutions dated 06.01.2015 of Defendant no. 4 (A1W1/18);

- (vii) Resolutions dated 06.01.2015 of Defendant no. 1 (A1W1/19);

- (viii) Working Capital Consortium Agreement dated 02.02.2013 (A1W1/20);

- (ix) Resolution dated 24.01.2013 of Defendant no. 4 (A1W1/21);

- (x) Joint Deed of Hypothecation dated 02.02.2013 (A1W1/22);

- (xi) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 02.02.2013 (A1W1/23);

- (xii) Deed of Guarantee dated 02.02.2013 executed by Defendants no. 2 & 3 in favour of the Consortium (A1W1/24);

- (xiii) Inter Se Agreement dated 02.02.2013 (A1W1/25);

- (xiv) Letter of Authority to the Lead Bank dated 02.02.2013 (A1W1/26);

- (xv) Letter of Undertakings by Defendants no. 2, 3 & 4 (A1W1/27);

- (xvi) Letter of Undertaking for creating Charge on Fixed Assets executed by Defendant no. 4 on 02.02.2013 (A1W1/28);

- (xvii) Working Capital Consortium Agreement dated 11.06.2014 (A1W1/29);

- (xviii) Resolution dated 28.05.2014 of Defendant no. 4 (A1W1/30);

- (xix) Joint Deed of Hypothecation dated 11.06.2014 (A1W1/31);

- (xx) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 11.06.2014 (A1W1/32);

- (xxi) Deed of Guarantee dated 11.06.2014 executed by Defendants no. 2 & 3 in favour of the Consortium (A1W1/33);

- (xxii) Agreement cum Indemnity dated 11.06.2014 (A1W1/34);

- (xxiii) Inter se Agreement dated 11.06.2014 (A1W1/35);

- (xxiv) Letter of Authority to the Lead Bank dated 11.06.2014 (A1W1/36);

- (xxv) Letter of Undertakings by Defendants no. 2, 3 & 4 dated 11.06.2014 (A1W1/37);

- (xxvi) Letter of Undertaking for creating a Second Charge on Fixed Assets executed by Defendant no. 4 on 11.06.2014 (A1W1/38);

- (xxvii) Affidavit of Assets of Defendants no. 2 & 3 as on 31.03.2014 (A1W1/39);

- (xxviii) Working Capital Consortium Agreement dated 08.01.2015 (A1W1/40);

- (xxix) Joint Deed of Hypothecation dated 08.01.2015 (A1W1/41);

- (xxx) Letter of Authority dated 08.01.2015 in favour of SBM (Lead Bank) (A1W1/42);

- (xxxi) Inter se Agreement dated 08.01.2015 (A1W1/43);

- (xxxii) Confirmation of Inter se Agreement dated 08.01.2015 by the Borrower Defendant no. 4 (A1W1/44);

- (xxxiii) Undertaking dated 08.01.2015 by the Borrower & Guarantors in favour of the Consortium Lenders (A1W1/45);

- (xxxiv) Deed of Guarantee dated 08.01.2015 by Defendants no. 1 to 3 (A1W1/46);

- (xxxv) Omnibus Counter Guarantee dated 08.01.2015 (A1W1/47);

- (xxxvi) Agreement cum Indemnity dated 08.01.2015 (A1W1/48);

- (xxxvii) Agreement for pledge of Shares dated 08.01.2015 by Defendants no. 1 to 3 in favour of the Applicant Banks / Consortium Lenders (A1W1/49);

- (xxxviii) Letter of Continuity dated 08.01.2015 (A1W1/50);

- (xxxix) Affidavits of Assets of Defendants no. 2 & 3 as on 31.03.2015 (A1W1/51);

- (xl) Revival Letters dated 02.01.2018 executed by Defendants no. 4 and Defendants no. 1 to 3 (A1W1/52);

- (xli) Duly audited Balance Sheets of Defendant no. 1 as on 31.03.2018 (A1W1/53);

- (xlii) Order dated 05.09.2017 passed by Special Bench of Hon'ble NCLT, Delhi (A1W1/54);

- (xliii) Order dated 21.08.2018 passed in (IB)-160 (ND)/2017 by Hon'ble NCLT, Principal Bench (A1W1/55);

- (xliv) Balance Confirmation Letters dated 31.03.2016 and 31.03.2017 executed by Defendant no. 1 (A1W1/56 & A1W1/57);

- (xlv) Claim filed by Applicant no. 1 Bank in Form D before the Liquidator appointed by the NCLT, Principal Bench, Delhi (A1W1/58);

- (xlvi) Recall Notice dated 24.12.2018 issued by Applicant no. 1 Bank to Defendants no. 1 to 3 (A1W1/59);

- (xlvii) Statement of Account duly certified under the Bankers Books of Evidence Act in respect of the Cash Credit, the calculation sheet of the accrued interest of Cash Credit Account and the Statement showing the total outstanding amount in respect of the credit facilities granted by Applicant no. 1 Bank (SBI) to Defendant (A1W1/60 to A1W1/69).

9. Similarly, Applicant Bank No. 2 / IDBI Bank Limited leads its evidence by filling the affidavit of Sh. Sanjeev Kumar Sarwalia, Deputy General Manager of the Applicant bank.

9.1 Sh. Sanjeev Kumar Sarwalia, officer of Applicant Bank no. 2 has placed reliance upon following documents:-

- (i) Delegation of Powers dated 23.11.2017 in favour of officer of Applicant no. 2 (A2W1/1);

- (ii) Sanction Letter(s) dated 27.11.2012, 21.03.2014 and 17.12.2014 issued by the Applicant no. 2 to Defendant no. 4 (A2W1/2 to A2W1/4);

- (iii) Resolutions dated 06.01.2015 of Defendant no. 4 (A2W1/5);

- (iv) Resolutions dated 06.01.2015 of Defendant no. 1 (A2W1/6);

- (v) Working Capital Consortium Agreement dated 26.12.2011 (A2W1/7);

- (vi) Working Capital Consortium Agreement dated 02.02.2013 (A2W1/8);

- (vii) Resolution dated 24.01.2013 of Defendant no. 4 (A2W1/9);

- (viii) Joint Deed of Hypothecation dated 02.02.2013 (A2W1/10);

- (ix) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 02.02.2013 (A2W1/11);

- (x) Deed of Guarantee dated 02.02.2013 executed by Defendants no. 2 & 3 in favour of the Consortium (A2W1/12);

- (xi) Inter Se Agreement dated 02.02.2013 (A2W1/13);

- (xii) Letter of Authority to the Lead Bank dated 02.02.2013 (A2W1/14);

- (xiii) Letter of Undertakings by Defendants no. 2, 3 & 4 (A2W1/15);

- (xiv) Letter of Undertaking for creating Charge on Fixed Assets executed by Defendant no. 4 on 02.02.2013 (A2W1/16);

- (xv) Working Capital Consortium Agreement dated 11.06.2014 (A2W1/17);

- (xvi) Resolution dated 28.05.2014 of Defendant no. 4 (A2W1/18);

- (xvii) Joint Deed of Hypothecation dated 11.06.2014 (A2W1/19);

- (xviii) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 11.06.2014 (A2W1/20);

- (xix) Deed of Guarantee dated 11.06.2014 executed by Defendants no. 2 & 3 in favour of the Consortium (A2W1/21);

- (xx) Agreement cum Indemnity dated 11.06.2014 (A2W1/22);

- (xxi) Omnibus Counter Guarantee dated 11.06.2014 for an amount of Rs. 625.00 Crore (A2W1/23);

- (xxii) Inter se Agreement dated 11.06.2014 (A2W1/24);

- (xxiii) Letter of Authority to the Lead Bank dated 11.06.2014 (A2W1/25);

- (xxiv) Letter of Undertakings by Defendants no. 2, 3 & 4 dated 11.06.2014 (A2W1/26);

- (xxv) Letter of Undertaking for creating a Second Charge on Fixed Assets executed by Defendant no. 4 on 11.06.2014 (A2W1/27);

- (xxvi) Affidavit of Assets of Defendants no. 2 & 3 as on 31.03.2014 (A2W1/28);

- (xxvii) Working Capital Consortium Agreement dated 08.01.2015 (A2W1/29);

- (xxviii) Joint Deed of Hypothecation dated 08.01.2015 (A2W1/30);

- (xxix) Letter of Authority dated 08.01.2015 in favour of SBM (Lead Bank) (A2W1/31);

- (xxx) Inter se Agreement dated 08.01.2015 (A2W1/32);

- (xxxi) Confirmation of Inter se Agreement dated 08.01.2015 by the Borrower Defendant no. 4 (A2W1/33);

- (xxxii) Undertaking dated 08.01.2015 by the Borrower & Guarantors in favour of the Consortium Lenders (A2W1/34);

- (xxxiii) Deed of Guarantee dated 08.01.2015 by Defendants no. 1 to 3 (A2W1/35);

- (xxxiv) Omnibus Counter Guarantee dated 08.01.2015 (A2W1/36);

- (xxxv) Agreement cum Indemnity dated 08.01.2015 (A2W1/37);

- (xxxvi) Agreement for pledge of Shares dated 08.01.2015 by Defendants no. 1 to 3 in favour of the Applicant Banks / Consortium Lenders (A2W1/38);

- (xxxvii) Letter of Continuity dated 08.01.2015 (A2W1/39);

- (xxxviii) Affidavits of Assets of Defendants no. 2 & 3 as on 31.03.2015 (A2W1/40);

- (xxxix) Revival Letters dated 02.01.2018 executed by Defendants no. 4 and Defendants no. 1 to 3 (A2W1/41);

- (xl) Order dated 05.09.2017 passed by Special Bench of Hon'ble NCLT, Delhi (A2W1/42);

- (xli) Order dated 21.08.2018 passed in (IB)-160 (ND)/2017 by Hon'ble NCLT, Principal Bench (A2W1/43);

- (xlii) Claim filed by Applicant no. 2 Bank in Form D before the Liquidator appointed by the NCLT, Principal Bench, Delhi (A2W1/44);

- (xlviii) Recall Notice dated 31.12.2018 issued by Applicant no. 2 Bank to Defendants no. 1 to 3 (A2W1/45);

- (xlix) Statement of Account duly certified under the Bankers Books of Evidence Act in respect of the Cash Credit, the calculation sheet of the accrued interest of Cash Credit Account and the Statement showing the total outstanding amount in respect of the credit facilities granted by Applicant no. 2 Bank (IDBI) to Defendant (A2W1/46 to A2W1/49).

10. So far as, Applicant Bank No. 3 / BOI is concerned, it leads its evidence by filling the affidavit of Sh. Pawan Kumar, Chief Manager of the Applicant bank.

10.1 Sh. Pawan Kumar, officer of Applicant Bank no. 3 has placed reliance upon following documents:-

- (i) Power of Attorney dated 20.04.2017 executed by Applicant no. 3 in favour of officer of Applicant no. 3 (A3W1/1);

- (ii) Sanction Letter dated 30.09.2014 issued by the Applicant no. 3 to Defendant no. 4 (A3W1/2);

- (iii) Sanction Letter dated 16.12.2014 issued by Applicant No. 3 whereby Sanction Letter dated 30.08.2014 was modified (A3W1/3);

- (iv) Resolutions dated 06.01.2015 of Defendant no. 4 (A3W1/4);

- (v) Resolutions dated 06.01.2015 of Defendant no. 1 (A3W1/5);

- (vi) Working Capital Consortium Agreement dated 08.01.2015 (A3W1/6);

- (vii) Joint Deed of Hypothecation dated 08.01.2015 (A3W1/7);

- (viii) Letter of Authority dated 08.01.2015 in favour of SBM (Lead Bank) (A3W1/8);

- (ix) Inter se Agreement dated 08.01.2015 (A1W1/43) (A3W1/9);

- (x) Confirmation of Inter se Agreement dated 08.01.2015 by the Borrower Defendant no. 4 (A3W1/10);

- (xi) Undertaking dated 08.01.2015 by the Borrower & Guarantors in favour of the Consortium Lenders (A3W1/11); 

- (xii) Deed of Guarantee dated 08.01.2015 by Defendants no. 1 to 3 (A3W1/12);

- (xiii) Omnibus Counter Guarantee dated 08.01.2015 (A3W1/13);

- (xiv) Agreement cum Indemnity dated 08.01.2015 (A3W1/14);

- (xv) Agreement for pledge of Shares dated 08.01.2015 by Defendants no. 1 to 3 in favour of the Applicant Banks / Consortium Lenders (A3W1/15);

- (xvi) Letter of Continuity dated 08.01.2015 (A3W1/16);

- (xvii) Affidavits of Assets of Defendants no. 2 & 3 as on 31.03.2015 (A3W1/17);

- (xviii) Revival Letters dated 02.01.2018 executed by Defendants no. 4 and Defendants no. 1 to 3 (A3W1/18);

- (xix) Order dated 05.09.2017 passed by Special Bench of Hon'ble NCLT, Delhi (A3W1/19);

- (xx) Order dated 21.08.2018 passed in (IB)-160 (ND)/2017 by Hon'ble NCLT, Principal Bench (A3W1/20);

- (xxi) Statement of Account duly certified under the Bankers Books of Evidence Act in respect of the Cash Credit, the calculation sheet of the accrued interest of Cash Credit Account and the Statement showing the total outstanding amount in respect of the credit facilities granted by Applicant no. 3 Bank (BOI) to Defendant (A3W1/21 to A3W1/23).

11. Similarly, Applicant Bank No. 4 / PNB also leads its evidence by filling the affidavit of Sh. Rajendra Singh, Assistant General Manager of the Applicant bank.


11.1 Sh. Rajendra Singh, officer of Applicant Bank no. 4 has placed reliance upon following documents:-

- (i) Certificate of Power of Attorney dated 15.02.1995 executed by Applicant no. 4 in favour of officer of Applicant no. 4 (A4W1/1);

- (ii) Sanction Letter dated 16.08.2010 issued by the Applicant no. 4 to Defendants (A4W1/2);

- (iii) Sanction Letter dated 21.09.2010 issued by Applicant No. 4 whereby credit facilities were enhanced / renewed (A4W1/3);

- (iv) Sanction Letters dated 15.12.2011, 12.03.2013, 28.02.2014 and 02.01.2015 issued by Applicant no. 4 to Defendant no. 4 (A4W1/5 to A4W1/7);

- (v) Sanction Letter dated 02.01.2015 of Applicant No. 4 (A4W1/8);

- (vi) Resolutions dated 06.01.2015 of Defendant no. 4 (A4W1/9);

- (vii) Resolutions dated 06.01.2015 of Defendant no. 1 (A4W1/10);

- (viii) Consortium Agreement dated 28.12.2011 (A4W1/11);

- (ix) Working Capital Consortium Agreement dated 02.02.2013 (A4W1/12);

- (x) Resolution dated 24.01.2013 of Defendant no. 4 (A4W1/13);

- (xi) Joint Deed of Hypothecation dated 02.02.2013 (A4W1/14);

- (xii) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 02.02.2013 (A4W1/15);

- (xiii) Deed of Guarantee dated 02.02.2013 executed by Defendants no. 2 & 3 in favour of the Consortium (A4W1/16);

- (xiv) Inter Se Agreement dated 02.02.2013 (A4W1/17);

- (xv) Letter of Authority to the Lead Bank dated 02.02.2013 (A4W1/18);

- (xvi) Letter of Undertakings by Defendants no. 2, 3 & 4 (A4W1/19);

- (xvii) Letter of Undertaking for creating Charge on Fixed Assets executed by Defendant no. 4 on 02.02.2013 (A4W1/20);

- (xviii) Working Capital Consortium Agreement dated 11.06.2014 (A4W1/21);

- (xix) Resolution dated 28.05.2014 of Defendant no. 4 (A4W1/22);

- (xx) Joint Deed of Hypothecation dated 11.06.2014 (A4W1/23);

- (xxi) Deed of Hypothecation of movable assets forming part of fixed / block assets dated 11.06.2014 (A4W1/24);

- (xxii) Deed of Guarantee dated 11.06.2014 executed by Defendants no. 2 & 3 in favour of the Consortium (A4W1/25);

- (xxiii) Agreement cum Indemnity dated 11.06.2014 (A4W1/26);

- (xxiv) Omnibus Counter Guarantee dated 11.06.2014 for an amount of Rs. 625.00 Crore (A4W1/27);

- (xxv) Inter se Agreement dated 11.06.2014 (A4W1/28);

- (xxvi) Letter of Authority to the Lead Bank dated 11.06.2014 (A4W1/29);

- (xxvii) Letter of Undertakings by Defendants no. 2, 3 & 4 dated 11.06.2014 (A4W1/30);

- (xxviii) Letter of Undertaking for creating a Second Charge on Fixed Assets executed by Defendant no. 4 on 11.06.2014 (A4W1/31);

- (xxix) Affidavit of Assets of Defendants no. 2 & 3 as on 31.03.2014 (A4W1/32);

- (xxx) Working Capital Consortium Agreement dated 08.01.2015 (A4W1/33);

- (xxxi) Joint Deed of Hypothecation dated 08.01.2015 (A4W1/34);

- (xxxii) Letter of Authority dated 08.01.2015 in favour of SBM (Lead Bank) (A4W1/35);

- (xxxiii) Inter se Agreement dated 08.01.2015 (A4W1/36);

- (xxxiv) Confirmation of Inter se Agreement dated 08.01.2015 by the Borrower Defendant no. 4 (A4W1/37);

- (xxxv) Undertaking dated 08.01.2015 by the Borrower & Guarantors in favour of the Consortium Lenders (A4W1/38);

- (xxxvi) Deed of Guarantee dated 08.01.2015 by Defendants no. 1 to 3 (A4W1/39);

- (xxxvii) Omnibus Counter Guarantee dated 08.01.2015 (A4W1/40);

- (xxxviii) Agreement cum Indemnity dated 08.01.2015 (A4W1/41);

- (xxxix) Agreement for pledge of Shares dated 08.01.2015 by Defendants no. 1 to 3 in favour of the Applicant Banks / Consortium Lenders (A4W1/42);

- (xl) Letter of Continuity dated 08.01.2015 (A4W1/43);

- (xli) Affidavits of Assets of Defendants no. 2 & 3 as on 31.03.2015 (A4W1/44);

- (xlii) Revival Letters dated 02.01.2018 executed by Defendants no. 4 and Defendants no. 1 to 3 (A4W1/45);

- (xliii) Order dated 05.09.2017 passed by Special Bench of Hon'ble NCLT, Delhi (A4W1/46);

- (xliv) Order dated 21.08.2018 passed in (IB)-160 (ND)/2017 by Hon'ble NCLT, Principal Bench (A4W1/47);

- (xlv) Claim filed by Applicant No. 4 in Form D filed before the Resolution Professional / Liquidator appointed by the NCLT, Principal Bench, Delhi vide its Order dated 08.08.2018 (A4W1/48);

- (xlvi) Recall Notice dated 01.01.2019 issued by the Applicant No. 4 to the Defendants no. 1 to 4 (A4W1/49);

- (xlvii) Statement of Account duly certified under the Bankers Books of Evidence Act in respect of the Cash Credit, the calculation sheet of the accrued interest of Cash Credit Account and the Statement showing the total outstanding amount in respect of the credit facilities granted by Applicant no. 3 Bank (BOI) to Defendant (A4W1/50 to A4W1/73).

12. So far as, evidence of Defendants no. 1 to 3 is concerned, they did not chose to file any evidence. Hence, the defence taken by these Defendants in their WS remained unsubstantiated / uncorroborated.

13. During the pendency of this OA, it was informed by the parties that Defendants no. 2 & 3 are under personal insolvency before Ld. NCLT, Delhi Further more, it is matter of record that Defendant no. 4 / Principal Borrower has also gone into liquidation as per orders passed by Ld. NCLT, Delhi.

In the light of above, it is clear that Defendants no. 2 to 4 are before Ld. NCLT, Delhi.

14. It is also matter of record that Defendant no. 1 stopped entering before the Tribunal since July 2025, hence, the case was proceeded ex parte qua Defendant no. 1 vide order dated 16.12.2025 of this Tribunal.

15. Heard Ld. counsel for Applicant Banks and perused the entire record.

15.1 Since, defendants no. 2 & 3 are already before Ld. NCLT, New Delhi, hence, there is no need to deal with the objections raised by defendants no. 2 & 3 in their common WS.

15.2 In the present case, though common WS & Counter Claim was filed by Defendant no. 1 along with Defendants no. 2 & 3 and without filing any evidence, Defendant no. 1 stopped entering before the Tribunal. Hence, the case was proceeded ex parte qua Defendant no. 1 on 16.12.2025.

Even otherwise, in the absence of any evidence, the defence taken by Defendant no. 1 in the WS remained unsubstantiated / uncorroborated. However, I would like to deal with the objections raised by Defendant no. 1 in following paras:-

- (i) Defendant no. 1 has raised an objection that the documents placed on record by Applicant no. 1 do not authorize persons holding the rank of AGM to sign, file, verify and institute the present proceedings on behalf of Applicant no. 1. In addition, no documentary proof has been placed on record to establish that Sh. Krishan Lal is indeed an AGM of the Applicant no. 1. Further more, no power of attorney or board resolution has been placed on record to support the authorization of Sh. Hayat Rawat to sign, file, verify and institute the present proceedings for and on behalf of the Applicant no. 4. Thus, in the absence of such authorization, the present proceedings have not been validly instituted and are liable to be dismissed *in limini*, at lease qua Applicants no. 1 and 4.

Though, Defendant no. 1 has not filed any evidence in support of its contention, it is matter of record that the Applicant Banks no. 1 to 4 have duly filed General Regulations along with Gazette Notifications of Applicant no. 1 (A1W1/1 to A1/W1/4); Delegations of Powers of Applicant no. 2 (A2W1/1); Power of Attorney(s) of Applicants no. 3 & 4 (A3W1/1 & A4W1/1) which make it abundantly clear that the OA has been filed by duly authorized officers / persons. Hence, this objection of Defendant no. 1 is hereby rejected.

- (ii) Next plea taken by the Defendant no. 1 is that the amounts claimed by the Applicants in the OA are incorrect which are neither due nor payable to the Applicants. It is stated that the computation of the alleged monies due to the Applicants is inconsistent with their respective claims qua the Principal Debtor i.e. Defendant no. 4. Moreover, the computation is replete with errors arising out of inclusion of amounts which have not ever been paid by the Applicants and are unlikely to be paid, being against discharged bank guarantees and letters of credit. Thus, there is no sanctity to the claims raised in the OA. It is also stated that despite it being trite law that Banks are not entitled to impose interest on accounts which have been rendered non-performing [breakup of the Inadmissible Interest for the respective Applicants is given in Para 8 at Page 4 of the WS]. It is also stated that at the time when the respective accounts were declared as NPA, the Applicants were holding monies in the nature of margin money to the tune of Rs. 106,74,49,295/-, however, while computing the claims against the Answering Defendants, the Applicants have not provided for adjustment of the said amounts [details given in Para 9 at page 4 of the WS]. Even otherwise, the Defendants no. 2 & 3 not having been incharge of Defendant no. 4 since 05.09.2017 (when its Board of Directors were suspended upon commencement of corporate insolvency resolution process), the answering defendants cannot be held responsible for the financial exposure of the Applicants undertaken thereafter since 05.09.2017. Such an attempt is A small blue rectangular stamp or mark is located at the bottom right of the page, below the page number. It appears to be a digital signature or a stamp, but the text within it is not legible.

untenable in law, more so when the Applicants themselves have been responsible for the affairs of Defendant no. 4 through its Resolution Professional and subsequently, the Liquidator.

Defendant no. 1 has failed to file any evidence in support of its contention, hence, this plea remained unsubstantiated. Even otherwise, Applicant Banks have already placed on record the Statement of Accounts and the Balance Confirmations on record to show the admission on behalf of Defendant no. 4 as a Borrower and Defendants no. 1 to 3 as guarantors. It is stated in the rejoinder that it is denied that once the account has been declared by a financial institution, it cannot claim it from the Borrower and Guarantors. In fact, as per the RBI guidelines, the Applicant Banks have to calculate the accrued interest for accounting purpose and due to accounting norms. Merely an accounting treatment to the accrued interest would not disallow the Applicant Banks from claiming the interest from the Borrower & Guarantors. Further more, Applicant Banks have duly filed their respective Statement of Accounts showing all the eligible adjustment (A1W1/60 to A1/W1/69 of Applicant no. 1, A2W1/40 A2W1/49 of Applicant no. 2, A3W1/21 to A3W1/23 of Applicant no. 3 and A4W1/50 to A4W1/73 of Applicant No. 4. Hence, this objection of Defendant no. 1 is also hereby rejected.

(iii) Next objection of Defendants no. 1 to 3 is that despite availability of margin money and an option to renew previously issue Bank Guarantees, instead of renewing the same (upon request of the beneficiary), encashed bank guarantees to the tune of Rs. 116.61 crore, thereby exacerbating the cashflow condition of EEPL, plunging in further illiquidity. The applicants having increased their exposure by imprudent and arbitrary conduct, cannot seek to recover the same from the answering Defendants who had time and again requested the Applicants to renew the bank guarantee instead of encashing the same. Accordingly, an amount of Rs. 116.61 crore must be deducted from the alleged claim of the Applicants in the manner, as detailed in Para 11 at page 6 of the WS.

In its rejoinder, Applicant Banks have clearly stated that the BGs are separate contracts and governed by the law of contracts. It is stated that the BGs were issued at the request of the Borrower against the margin money and in case the beneficiary encashed the BGs, the Banks have no other option but to pay the same to the beneficiary as per the contract and are entitled to adjust the margin money once the bank paid the BGs amount to the beneficiaries.

I also find merit in the contention of Applicant Banks, accordingly, this objection of Defendant no. 1 stands rejected.

- (iv) Defendants no. 1 to 3 have also raised an objection that the Applicants ought not to be permitted to place reliance on the so-called Revival Letter dated 02.01.2018, which the answering Defendants were coerced to execute under threat of proceedings under the IBC 2016 for non-cooperation with the Resolution Professional. It is also stated that the answering Defendants were required to sign on the dotted lines and standard form contracts, with no scope for negotiations. The Applicants, being the members of the Committee of Creditors, having decided to seek liquidation of Defendant no. 4, which prayer was granted by Ld. NCLT vide its Order dated 20.08.2018, cannot seek to derive any benefits therefrom, especially for alleging that such order of liquidation resulted in creation of a cause of action in their favour to proceed against the answering Defendants. Further more, invocation of corporate and personal guarantees issued by the answering Defendants was grossly time barred. Apart, admittedly, Applicant no. 3 did not invoke the corporate and personal guarantees issued by the answering Defendants ahead of filing of present proceedings. Hence, there is no cause of action available for commencement and continuation of present proceedings.

It is matter of record that Defendant no. 1 has not filed any evidence in support of its contention. Even otherwise, in the light of law laid down by the Hon'ble Delhi High Court in the matter of 

"Indian Bank Vs. Cheese Wafers (India) Pvt. Ltd. wherein it was held if the defendants have not filed any complaint before higher authorities of the bank or filed any complaint before police authorities.....". Thus, the plea of signing the documents under misrepresentation / blank / unfilled documents / without consent, alleged to be misused by the Applicant Banks, is not maintainable after filing of the suit. So far as, question of not issuing the recall notice by Applicant no. 3 is concerned, once availment of loan facility / execution of security documents is already admitted by Defendant no. 1, now at this stage of paying the dues of the Applicant Banks, Defendant no. 1 cannot take the benefit of such plea. Accordingly, this objection of Defendant no. 1 is hereby rejected.

15.3 So far as, Counter Claim filed by Defendant no. 1 is concerned, same is filed by Defendants no. 1 to 3 who stood as guarantor to Defendant no. 4 / Principal Borrower. It is matter of record that Defendant no. 1 is a Corporate Guarantor of Defendant no. 4 (Principal Borrower) and Defendant no. 4 has not filed any Counter Claim and WS in the OA filed by the Applicant Bank.

In this case, Defendant no. 4 is a Borrower and impleaded in the present OA as a proforma party as Liquidation Process has already been started by NCLT. Therefore, submissions on behalf of Defendant no. 4 can be made by the Liquidator only, representing Defendant no. 4 and not by Defendants no. 1 to 3. In these circumstances, the Counter Claim filed by the Defendants no.1 to 3 on behalf of Defendant no. 4 cannot be considered.

In the light of above, the Counter Claim filed by Defendant no. 1 is hereby rejected. However, it is made clear that the Defendant no. 1, being Corporate Guarantor, is liable for the amount claimed by the Applicant Banks qua the credit facilities granted to Defendant no. 4 (Borrower Company).

15.4 So far as, Defendant no. 4 is concerned, it has already gone into liquidation as per directions of Ld. NCLT, Delhi, hence, no order can be passed qua Defendant no. 4. Even otherwise, Applicant Banks have not sought any relief qua Defendant no. 4 in this OA.

However, it is directed that in case Applicant Banks receives any amount from liquidation proceedings of Defendant no. 4 / Principal Borrower pending before Ld. NCLT, New Delhi, they shall give due adjustment of the same in the recovery proceedings.

15.5 So far as, Defendant no. 5 / BOM is concerned, it is a proforma defendant and no relief has been claimed by the Applicant Banks against said defendant.

15.6 On the other hand, the witnesses of applicant banks have fully corroborated the averments made in the OA. Even otherwise the whole case of the applicant bank/s is based on the documents and the witness has duly proved all these documents. The evidence filed by the applicant banks gone unrebuted and there is no question of disbelieving the evidence lead by the applicant banks and applicant banks have proved its case beyond reasonable doubts. Accordingly, the Applicant Banks are entitled to recover the entire amount, as claimed in the OA from the defendants along with pendentelite interest i.e. @12.5% p.a. and costs as agreed between the parties.

15.7 In this OA, Applicant Banks have prayed to issue recovery certificate against Defendants no. 1 to 3 wherein the defendant 1 is corporate guarantor and defendants no. 2 & 3 are personal guarantors.

15.8 It is matter of record that personal insolvency proceedings have been commenced qua defendants no. 2 & 3 before Ld. NCLT, Delhi. In these circumstances, no final order can be passed qua defendants no. 2 & 3, at this stage.

However, it is directed that applicant bank shall be at liberty to revive the OA qua defendants no. 2 & 3 in case personal insolvency proceedings are quashed / withdrawn in future, in accordance with law.

It is also directed that in case applicant Bank receives any amount from personal insolvency proceedings, it shall give due adjustment of the same in the recovery proceedings.

15.9 Consequently, TA No. 89/2022 is liable to be allowed in favour of Applicant Banks against Defendant no. 1 only (being corporate guarantor to the Borrower company i.e. defendant no. 4), who is liable to pay the dues of the applicant along with costs and pendentelite & future interest @12.5% p.a., from the date of filing of present OA, till the date of payment in full.

ORDER

- (i) TA No. 89/2022 stands allowed in favour of Applicant Banks no. 1 to 4 and against the Defendant no. 1 for a sum of Rs. 1361,67,36,061.21 (Rupees One Thousand Three Hundred Sixty One Crore Sixty Seven Lakh Thirty Six Thousand Sixty One and Paise Twenty One only) in following manner:-

<thead> <tr> <th>Applicant Bank(s)</th> <th>Amount<br/>(in Rupees)</th> </tr> </thead> <tbody> <tr> <td>Applicant No. 1 / SBI</td> <td>Rs. 794,00,32,924.21</td> </tr> <tr> <td>Applicant No. 2 /<br/>IDBI Bank Limited</td> <td>Rs. 100,51,51,419.74</td> </tr> <tr> <td>Applicant No. 3 / BOI</td> <td>Rs. 102,49,11,557.95</td> </tr> <tr> <td>Applicant No. 4 / PNB</td> <td>Rs. 364,66,40,159.31</td> </tr> </tbody> </table>

along with pendentelite and future interest @12.5% p.a. from the date of filing of this OA till the date of actual and final realization along with costs of this OA. Now Defendant no. 1 is directed to pay to the Applicant Bank the aforesaid amount, within 30 days, failing which, the aforesaid amount shall be recovered from the sale of secured assets / mortgaged properties / hypothecated assets / stocks / pledged shares etc., if any, belonging to the Defendant no. 1.

In case of shortfall, same shall be recovered from the movable and immovable assets of Defendant no. 1.

(ii) Since defendants no. 2 & 3 are before Ld. NCLT, Delhi, hence, no final order can be passed qua defendants no. 2 & 3, at this stage (as discussed above).

However, it is directed that applicants bank shall be at liberty to revive the OA qua defendants no. 2 & 3 in case personal insolvency proceedings are quashed / withdrawn in future, in accordance with law.

It is also directed that in case Applicant Banks receives any amount from personal insolvency proceedings, they shall give due adjustment of the same in the recovery proceedings.

- (iii) It is also directed that in case Applicant Banks receives any amount from liquidation proceedings of Defendant no. 4 / Principal Borrower pending before Ld. NCLT, New Delhi, they shall give due adjustment of the same in the recovery proceedings.

- (iv) It is also directed that the sale proceeds of the secured assets shall be distributed between the Applicant Banks and proforma Defendant No. 5, as per inter-se agreements executed amongst them.

- (v) It is also directed that the applicants shall adjust the amount(s), if any, received from the defendants during the pendency of this case.

- (vi) The recovery certificate be issued forthwith and be sent to the Recovery Officer-II, Debts Recovery Tribunal-III, Delhi.

- (vii) Parties are directed to appear before the Recovery Officer-II, DRT-III, Delhi on 10.07.2026.

TA-89/2022

(viii) Copies of final order as well as Recovery Certificate be sent to all concerned free of cost.

File be closed and consigned to records.

(SHIV KUMAR - I) PRESIDING OFFICER, DRT-III, DELHI

(Pronounced in open court) Dated: 21.04.2026

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