The National Company Court (NCLT) has ordered to order Tires Ltd insolvency proceedings against Birla to commence, the suit was filed by diversified chemical company SRF Ltd (BK Birla referred to the operating creditors of the group company. Kolkata NCLT two judges also appointed Seikh Abdul Salam Interim Resolution Expert (IRP), the company’s board of directors to suspend operations and declare a moratorium on insolvency Insolvency Bankruptcy Board (IBC) proceedings are over to take charge of the company’s operations.

SRF claimed that as on July 8, 2021, Cordage Supply was in arrears of Rs 1,584 crore, of which Rs 100.6 crore was principal and Rs 5.78 crore was interest.

The tribunal said it was satisfied “on the basis of the documents”, including the claims of the parties, that there was a “default” and determined that the outstanding operating liabilities had not been paid, which was also admitted by Belira Tires, the company said. Debtors.

The order passed by the NCLT judge on May 5, 2022 said, “The application for initiation of CIRP by the corporate debtor Tires Ltd filed by the operating creditor SRF Ltd under Rule Birla of the Insolvency and Bankruptcy Rules, Ninth Year, 2016, has been allowed.”

Further, the NCLT bench comprising technical member Harish Chander and judicial member Suri Rohit Kapoor also accused the BK Birla Group of companies of “very casual attempts” to defer the matter.

In this matter, the NCLT issued a notice to Birla Tires on October 20, 2021 at the request of the SRF.

On December 22, 2021, Birla Tires sought an extension of time to file its response. On February 28, 2022, BK Birla Group of Companies again sought more time and NCLT gave them two weeks.

At the next hearing held on April 5, 2022, on a daily basis, the Birla Tires again sought a further extension of time on the basis of plant closure, but the NCLT refused and upheld the order.

“Please note that the actual purpose of these clauses of the IBC is to complete the insolvency proceedings within a limited period of time to maximize the value of the assets and to allow for sequential adjournments, which also allows for adjudication. The adjudicating authority refused to grant further extension of time for filing of reply and affidavit by the corporate debtor as the authority could not accept any reason.

It is clear from the record that Birla Tires had a reasonable opportunity to file its replying affidavit but failed to do so in spite of ample opportunities to do so.