NCLT admits Canara Bank's insolvency plea against PSK Developers
This story was originally published at 18:37 IST on 8 October 2024
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NEW DELHI – The Mumbai bench of the National Company Law Tribunal has admitted a petition by Canara Bank to start insolvency proceedings against PSK Developers Pvt. Ltd. for default in repayment of INR 335.05 million. The tribunal appointed Megha Agrawal as the interim resolution professional of PSK Developers to carry out the functions as per the Insolvency and Bankruptcy Code. The tribunal directed a moratorium against PSK Developers.
PSK Developers approached Canara Bank and erstwhile Syndicate Bank in 2013 to part-finance a real estate development project through term loans. The banks sanctioned term loans of INR 1.85 billion. The account was declared a non-performing asset on the books of Syndicate Bank in 2017 and Canara Bank in 2018. Canara Bank moved the tribunal to start insolvency proceedings against PSK Developers in 2023.
After the insolvency petition was filed, PSK Developers approached Canara Bank for repayment of the loan. PSK Developers proposed to pay an amount of INR 215 million towards one-time settlement of the entire outstanding amount. The bank sanctioned the one-time settlement and imposed certain conditions on the company but later withdrew the sanction due to non-compliance of the terms. Thereafter, the bank identified the account of PSK Developers as a wilful defaulter in February.
Today, the shares of Canara Bank ended 1.4% higher at INR 104.95 on the National Stock Exchange. End
Reported by Surya Tripathi
Edited by Saji George Titus
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