National Company Law Tribunal orders auction of two Rotomac firms

LUCKNOW: Cracking down on bank loan defaulter Rotomac Global chief Vikram Kothari, the National Company Law Tribunal (NCLT) on Wednesday directed the authorities concerned to wind up two companies of Rotomac owned by Kanpur based businessman here on Wednesday.

Acting on an application filed by Bank of Baroda, NCLT ordered the auction of two firms of Kothari who is facing an allegation of non-payment of Bank loan to the tune of several crores. The two companies facing auction are Global and Exports.

The NCLT passed this order when the 180-day limit for repayment ended on March 19, 2018. 

The creditors' committee refused to extend the limit any further.

Hearing an application filed by Bank of Baroda, the National Company Law Tribunal, Allahabad further directed the Resolution Professionals to submit closure report within a month.

Besides, the NCLT also appointed Anil Goyal as ‘Liquidator’ in the matter who would facilitate in the auction of the assets of the two companies.

In addition to it, the NCLT directed the Liquidator to submit closure report within 30 days. It is alleged that both the companies of Rotomac – Global and Exports -- have to pay bank loan worth around Rs 4000 crore.

Rotomac Pens owner Vikram Kothari, his son Rahul Kothari and two directors of the company were held last month for defrauding a consortium of banks of over Rs 3,695 crore.  

Kothari had taken several loans worth Rs 2,919 crore - with interest around Rs 3,695 crore - from a consortium of seven banks comprising Bank of Baroda, Indian Overseas Bank, Union Bank of India, Allahabad Bank, Bank of Maharashtra and Oriental Bank of Commerce in 2008-09.

However, it is alleged that the directors cheated the banks by diverting funds so raised in connivance with certain bank officials.

The instances were allegedly found where the credit sanctioned and disbursed to the company was used for purposes other than execution of the claimed export orders.