Mumbai Bench Of NCLT Initiates Corporate Insolvency Resolution Process Against D S Kulkarni Developers Limited

The Mumbai bench of the National Company Law Tribunal (NCLT) has initiated a corporate insolvency resolution process against D S Kulkarni Developers Limited (DSKDL).

DSKDL happens to be the sole public limited company of jailed developer D S Kulkarni.

The process was initiated after a petition by the Bank of Maharashtra (BoM) over a default of debt worth Rs 119.48 crore by DSKDL was admitted, according to a statement released by an interim resolution professional appointed by the NCLT.

The insolvency process is aimed at prioritizing settlement of claims by financial creditors, fixed deposit holders and those who purchased homes from DSKDL.

On July 24, 2017, the Bank of Maharashtra classified DSKDL as a non-performing asset and issued a notice initiating recovery process under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002.

On December 15, 2018, the Debts Recovery Tribunal (DRT) bench in Pune directed DSDKL to pay an aggregate sum of Rs 74.07 crore to the bank.

Later, the NCLT held that the bank established the default on the part of the DSKDL and the DRT.

The latest NCLT statement has also called upon financial creditors and fixed deposit (FD) holders, besides those who purchased homes from DSKDL to submit their claims with evidence by October 9.

It may be recalled that in an order dated September 26, the NCLT had placed DSKDL under a moratorium by prohibiting institution of any suits or continuation of pending suits against the company before any court, tribunal or adjudicating authority.

It had also restrained DSKDL from transferring, alienating or disposing of any of its assets till “the completion of the insolvency process or until the bench approves a resolution plan under IBC or an order for liquidation of the corporate debtor”.