The Mumbai bench of the bankruptcy court has admitted an insolvency resolution petition filed by IDBI Bank against entertainment and event management company Wizcraft International Entertainment over default claimed to be over Rs 60 crore.
The National Company Law Tribunal bench also earlier this month approved the name of Vinit Gangwal as the interim resolution professional for the Mumbai-based company. IDBI Bank had given a loan to Great Indian Nautanki Company (GINC), a subsidiary of Wizcraft that runs India’s first live entertainment destination, Kingdom of Dreams, in Gurgaon. Wizcraft had provided a corporate guarantee to the loan. IDBI Bank has claimed that Wizcraft owed it Rs 60.39 crore as of June 1, 2019.
The Mumbai bench in matter titled IDBI vs. Wizcraft International Pvt Ltd [CP (IB)-3000/MB/2019] held:
“64. Considering the above facts, we come to conclusion that the nature of debt is a ―Financial Debt as defined under Section 5(8) of the Code. It has also been established that there is a ―Default as defined under Section 3(12) of the Code on the part of the Debtor. The two essential qualifications, i.e., existence of debt‘ and default‘, for admission of a Petition under Section 7 of the I&B Code, have been met in this case. Besides, the Company Petition is well within the period of limitation.”
ISSUE OF LIMITATION
The Hon‘ble Supreme Court has held that limitation can only be extended in the manner provided u/s. 18 of Limitation Act, 1963. Hon‘ble Supreme Court in Jignesh Shah and BK Education Services Private Limited reported in 2018 SCC OnLine SC 1921 has also held that Article 137 of Limitation Act, 1963 shall be applicable to the application filed u/section 7 and 9 of IBC.
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