The Chennai Bench of National Company Law Tribunal (NCLT) has ordered insolvency proceedings against Fatheypori Gardens Pvt Ltd, which provided corporate guarantee of ₹1,547.17 crore for loans availed by Surana Corporation Ltd, from a consortium of banks led by State Bank of India (SBI)
According to the petition filed by SBI, the total amount of default as on March 2, 2018 is about ₹699.25 crore. Other lenders include Punjab National Bank, Central Bank of India, IDBI Bank and Bank of India.
Surana Corporation, which is already facing insolvency proceedings, failed to pay the interest on October 2014 and an corporate restructuring plan also did not go through. The banks had declared the loan as a non-performing asset from June 28, 2014, according to the petition.
Fatheypori Gardens has executed a guarantee in 2015, assuring repayment of the entire loan liability of ₹1547.15 crore of Surana along with interest and other charges and also mortgaged some of its properties.
NCLT ordered the commencement of insolvency proceedings against Fatheypori and has appointed C. Ramasubramaniam, as Interim Resolution Professional. In September 2018, the SEBI barred three directors of Surana Corporation from the market.
It also restrained them from holding any position in any listed company for five years for misrepresentation of financial results.