Minutes of Eighth Meeting of Committee of …exposecc.info/eccImages/Documents/8-CoC-Minutes-SRS...SRS Limited Minutes of Eight Meeting of CoC the meeting. Further, as per Section

SRS Limited Minutes of Eight Meeting of CoC

Minutes of Eighth Meeting of Committee of Creditors (CoC) of SRS LIMITED

(Undergoing Corporate Insolvency Resolution Process) (Insolvency Commencement Date 2lSt August, 2018)

(CI N: L74999HR2000PLC040183)

The Eighth meeting of the Committee of Creditors of "SRS LIMITED" was held on Wednesday,

the 0 6 ~ ~ d a ~ of March, 2019 at 11:OO A.M at 4th Floor, Avanta Business Centre Pvt Ltd,

Statesmen House, Barakhamba Road, Connaught Place, New Delhi-110001.Following persons

were present and attended the meeting (Attendance Sheet enclosed):

I. Mr. Ashok Kumar Gulla, Resolution Professional (RP)

2. Mr. Anil Kanotra, Assistant General Manager, State Bank of lndia

3. Mr. Pawan Kumar, Chief Manager, Bank of lndia

4. Mr. Piyush Sood, Senior Manager, Bank of lndia

Mr. Anurag Gupta, Senior Manager, Union Bank of lndia

Ms. Ruchi Singhal, Chief Manager, Oriental Bank of Commerce

Mr. RK Sharma, Assistant General Manager, Syndicate Bank

Mr Anil Garg, Consultant, Syndicate Bank

Mr Anuj Trivedi, Area Legal Manager, Axis Bank

Mr Sandeep Singh, Assistant Legal Manager, Axis Bank

Mr. Devinder Arora, Authorised Representative for Deposit Holders

Mr. Surender Kumar, Inspectorof Income Tax Office, Faridabad (Representative of

Operational Creditor)

Mr Robin Sirohi, Legal counsel for Resolution Professional

Mr. Raju Bansal, Director, SRS Limited

Mr. Tinku Singh, Group President and Chief Strategic Officer, SRS Limited

Mr. Dheeraj Madan, Chartered Accountant (from RP Team)

Ms Prerna Jain, Chartered Accountant (from RP Team)

Mr. Mohit Vijay, Company Secretan/ (from RP Team)

Mr. Shantanu Naresh, Lawyer (from RP Team)

Mr. Mohit Kapoor, Chartered Accountant (from RP Team)

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Ashok Kurnar Resolution Professional for SRS Ltd


Shri Ashok Kumar Gulla, Resolution Professional welcomed all the members of Committee of

Creditors who were present in the meeting including Authorised representative of Deposit

holders and Representative of lncome Tax Ofice, Faridabad (Operational Creditor holding

more than 10% of total debt admitted). He mentioned that the meeting had been called to

discuss and deliberate upon present status of resolution plans received from shortlisted

Resolution Applicants, to discuss application filed by other parties with Hon'ble NCLT claiming

ownership over certain properties and other issues regarding Corporate Insolvency Resolution

Process (CIRP). Thereafter, various items of Agenda were taken up for noting

/diocussion/approval as detailed below:

Agenda Item No 1:

To ascertain auorum for the meeting in accordance with the ~rovisions of Regulation 22 of

the lnsolvencv and Bankruptcv Board of lndia (Insolvencv Resolution Process for Corporate

Persons) Regulations. 2016

Shri Ashok Kumar Gulla, Resolution Professional ("RP") mentioned that as per the Regulation

22 (1) of the Insolvency and Bankruptcy Board of lndia (Insolvency Resolution Process for

Corporate Persons) Regulations 2016, a meeting of the Committee of Creditors ("CoC") shall

be quorate if the members representing at least 33% of the voting rights shall be present

either in person or by video conferencing or other audio and visual means.

Shri Ashok Kumar Gulla, RP had taken roll call and all the members of CoC including

Authorized Representative of Deposit holders were present. Thus, the meeting of the CoC was

quorate with the members representing 100% of the voting rights present in person.

As discussed in seventh CoC meeting held on 15.02.2019, the claim of Assistant Commissioner

of lncome Tax, Central Circle II, Faridabad was more than 10% of debt and therefore, they

were also given notice for attending this eight meeting of CoC as per Section 24(3)(C) of the

Insolvency and Bankruptcy Code, 2016 ("IBC, 2016"). Mr Surender Kumar,

Tax, Representative of lncome Tax Office, Faridabad, Operational Creditor

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the meeting. Further, as per Section 24(4) of IBC, 2016, the operational creditor did not have

any right to vote in the meeting.

Agenda ltem No 2:

To take note of the minutes of Seventh Meeting of Committee of Creditors ("CoC") held on

1 5 ~ ~ Februarv. 2019

Shri Ashok Kumar Gulla, Resolution Professional informed that the minutes of the Seventh

Meeting of Committee of Creditors held on 1 5 ~ ~ ~ e b r u a r ~ , 2019 was circulated to all the

members on February, 2019.

Resolution Professional mentioned about Point No 4 in Agenda No 7, discussed in seventh CoC

Meeting detailing about the application filed by shop owners of SRS Mall, Sector 12, Faridabad

with Hon'ble NCLT, Chandigarh. It was stated that Hon'ble NCLT, Chandigarh has directed as

under:

"Resolution Professional shall file the complete response with regard to the decision of the

CoC about the claims made by the applicant in Form B".

Resolution Professional informed CoC that above mentioned direction was in the application

filed for ownership of Units 306 and 307 at SRS Tower, Mewala Maharajpur, Faridabad

(explained in detail in Agenda No 4 discussed in this CoC Meeting).

The minutes of Seventh CoC Meeting were taken on record by members of CoC.

Agenda ltem No. 3:

To discuss and take note of the total claims of creditors and voting share of the Committee

of Creditors

Shri Ashok Kumar Gulla, Resolution Professional mentioned that he has received a

claims of Financial Creditors being banks and Deposit Holders, Operational

claims of workmen, employees and statutory authorities in terms of


Ashok Kumar Gulla k Resolution Professional for SRS Ltd


IBBl (Insolvency Resolution Process for Corporate Persons) Regulations 2016 ("CIRP

Regulations").

The voting share of members of CoC has undergone minor change from the details shared in

the last CoC Meeting held on 15.02.2019 due to receipt of further claims of deposit holders.

The voting share of members of CoC is given below:

The details of total claims received and admitted are as under:

S. NO.

1.

2. 3.

4.

5.

6. 7.

Total

he list of creditors whose claims have been received and admitted is uploaded at

SRS i.e. srsparivar.com as well as on both stock exchanges.

Ashok Kumar Gulla Resolution Professional for SRS Ltd

Name of the Financial Creditor

State Bank of lndia Bank of India Union Bank of lndia Oriental Bank of Commerce Deposit Holders (Class of creditors) Syndicate Bank Axis Bank Limited

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b B#.

1 2 3

4

5

Amount Claimed (INR) '

6,28,31,58,213.31

2,23,79,59,143.69 1,25,59,70,113.38

68,78,72,193.38

82,46,83,633.60

14,13,19,684.04 56,64,645.00

11,43,66,27,626.40

Name of g& Creditor

I

Financial creditors Deposit Holders (class of creditors) Operational Creditors (other than workmen/employee and statutory authorities) Statutory Authorities Workmen/Employees

Total Amaunt claimed Amount of claim

TOTAL

till 19,11.2&8 I (IWR) ,

10,61,19,43,992.80 82,46,83,633.60 33,67,48,645.82

1,57,81,70,897.00

1,55,45,390.00

13,36,70,92,559.22

Amount of claim Admitted (INR)

6,28,31,58,213.31

2,23,79,59,143.69 1,25,24,58,703.64

68,78,72,193.38

82,08,05,259.92

14,13,19,684.04 54,90,631.00

11,42,90,63,828.98

admitted (INR) .

10,60,82,58,569.06 82,08,05,259.92 29,48,90,843.44

1,49,83,56,393.00

1,53,58,431.45

13,23,76,69,496.87

Security Interest

Secured

Secured Secured

Secured

Unsecured

Secured Secured

Voting Share

54.98%

19.58% 10.96%

6.02%

7.18%

1.24% 0.05%

100.00%


Agenda Item No. 4:

To discuss the application filed bv various parties with Hon'ble NCLT claiming ownership of

pro~ert ies owned bv Corporate Debtor.

Shri Ashok Kumar Gulla, Resolution Professional informed CoC about status of application filed

by various parties claiming the ownership of properties owned by SRS Limited.

A ~ ~ l i c a t i o n filed bv Intervener claiming ownership over Units 306 and 307 located at SRS

Tower. Mewala Maharaipur, Farldabad [Application No - CA No 80120191:

I. Shri Ashok Kumar Gulla mentioned as under:

i. Resolution Professional discussed in last CoC meeting held on 15.02.2019 about the

properties owned by SRS Limited in SRS Tower, Mewala Maharajpur, Faridabad. Further,

SRS Tower was developed by SRS Real Infrastructure Private Limited. SRS Limited owns

following properties in SRS Tower located at Sector 31 Faridabad:

ii. The properties mentioned at S Nos 1-5 were purchased vide Allotment Deed executed

SNO

1

2

3

4

5

6

7

on 22.03.2012 for Rs 6.71 Crores. The Resolution Professional has not been granted

access to any of the properties mentioned in the above table by SRS Tower

Unit No.

Unit No. 46 on Ground Floor

Unit No. 304 on third floor


Unit No. 306 on third Floor


Top Floor (Eighth Floor)

Lower Ground Floor

Association. Hence, an application (CA No 79/2019) was filed with Hon'ble NCLT,

Chandigarh seeking the possession of the properties mentioned in above table. The - -

matter came up for hearing on 7th February, 2019. The next date of hearin

1 3 ~ ~ March, 2019. C


Area (In Sq. Ft. in Super Area)

1,816

6,605

4,159

4,102

2,503

12,806

11,248

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Date of Purchase

Mar-12

Mar-12

Mar-12

Mar-12

Mar-12

Mar-13

Jun-13


iii. It has been learnt that the Corporate Debtor had entered into an agreement dated

11.04.2017 for the cancellation of unit Nos. 305, 306 and 307 with SRS Real

lnfrastructure Limited. It was found that the cancellation deed entered into between

SRS Limited and developer i.e. SRS Real lnfrastructure Limited was unregistered.

Further, in the cancellation deed for Units 306 and 307, there was also a condition

imposed in the deed that the Developer shall refund the amount of INR 1.46 Crs to SRS

Limited towards cancellation which has not been paid till date. Thus, the cancellation

deed is invalid.

iv. SRS Real Infrastructure has further allotted Units 306 and 307 to another person

("intervener") after entering into cancellation deed with SRS Limited.

v. The Resolution Professional has filed a civil suit for declaration and permanent

injunction of Units 306 and 307.

2. RP brought this to the notice of CoC that the intervener has filed an application CA No

80/2019 with Hon'ble NCLT stating that he is the actual owner of the properties. He further

stated that he had given the said property on rent to the Corporate Debtor vide rent

agreement dated 11.04.2017 for 18 years w.e.f. 01.04.2017 at a monthly rent of INR

2,30,000/- which shall escalate by 10% after every three years of lease. He has also filed

claimed for the Rent overdue amounting to Rs.38,96,200.

3. The matter had come up for the hearing on 7th February, 2019 wherein Honlble NCLT has

directed as under:

"In the meanwhile, The Resolution Professional shall file complete response with regard to

the decision of CoC about the claim made by the applicant in Form B".

The matter is now listed for March 13, 2019.

4. CoC discussed the matter in detail and was of the view as under:


Ashok KI Resolution Professional for SRS Ltd


i. The Units 306 and 307 had been surrendered by SRS Limited to the Developer vide

Cancellation Deed dated 11.04.2017 which is an unregistered agreement and the sum

agreed therein has not been received therefore SRS Limited is a legal owner t o the said

units.

ii. The rent agreement entered between intervener and erstwhile management of

Corporate Debtor is null and void as the actual ownership has not been transferred.

iii. The claim submitted by the intervener in Form B should not be accepted as intervener is

not the owner of the property.

iv. Legal notice should be sent t o the intervener for repaying the rent already paid by SRS

Limited t o him.

It was further brought to the notice of CoC that the RWA of SRS Tower has allowed us the

possession of above mentioned unit in SRS Tower and RP had received an intimation from

the lntervener that they are the owner of the property. Hence, a civil suit has been filed for

the clarity on the ownership of the property. Subsequently the Intervener has preferred an

application with the Hon'ble NCLT where it has been mentioned that the lntervener for

Unit No. 306 and 307 has taken the possession of the said units, Hence, it needs to be

brought to the notice of CoC members that RP has initiated the matter to the Local Police

authority that an illegal possession has been taken by the Intervener.

Lastly, State bank of lndia brought to the notice that entire SRS Tower at Sector 31,

Faridabad is mortgaged by SRS Real lnfrastructure Private Limited for the credit facilities

availed by them with Central Bank of India. The Resolution Professional have been

informed by the COC that entire SRS Tower is charged t o banks. The RP Team had written

to Central Bank of lndia stating that SRS Limited holds few office units in the SRS Tower, the

Central Bank of lndia has replied the following in this matter:-

"It is submitted that the Bank granted the credit facilities to M/s SRS Real Infrastructure

Limited in 2008 year for construction of IT Park (SRS Tower). I t is pertinent to mention that 1

Borrower has not taken any prior approval/ NOC from the Bank to Sell. Assign,

alienate or otherwise dispose or any of the assets of the borrower charged to the

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A~ulication CA Nos 7712019 and 7812019 filed bv Shor, Owners with Hon'ble NCLT,

Chandinarh claiminn ownership on shops in SRS Limited:

Shri Ashok Kumar Gulla, RP appraised CoC on the status of shops sold in the SRS Mall,

Sector 12, Faridabad. He stated that while examining various documents after initiation of

CIRP, it was learnt that the SRS Mall has been mortgaged to the Consortium of Banks

against the Loans provided to SRS limited. The charge has been created by way of equitable

mortgage on 25.08.2007. Further, it was identified that few shops (17 in No. including

Outer Kiosk) in the mall has been sold after the mall was mortgaged to the Lenders and few

shops have been sold via Buyers Agreement (09 in No.), either prior to the said mortgage

or after creation of mortgage in favour of consortium. As per the opinion of the Legal

Counsel the sale of Shops after mortgaging and sale through Buyers Agreement does not

constitute a valid transfer, Hence, a Legal Notice was sent to all the 26 parties

("interveners") who had purchased the shops after 25.08.2007 and also via Buyers

Agreement to surrender the possession of the shops. Shop Owners in response to the Legal

Notice has approached the Hon'ble NCLT - Chandigarh for the necessary relief vide

Application No 7712019 filed by Manju Gupta and 7812019 filed by 19 shop owners. The

matter was heard with Hon'ble NCLT on February 6th and 7th, 2019 and the matter is now

listed for hearing on March 13,2019.

In the interim order the AA required RP to file reply for the application filed by intervener.

Further, out of the above mentioned shops, SRS Limited had taken few Shops on rent. The

Shop Owners were paid Rent in the past except for the few months. The shop owners had

filed the claim as operational creditor for the Rent not paid by SRS Limited. Since a proper

Rent agreement was executed between the Shop Owner and SRS Limited for the taking the

shops on Rent, hence the claims were admitted for the outstanding Rent and subsequently

on identification that the transfer does not constitute a valid transfer and the interveners

are not the legal owner to the property.




The matter was also discussed during the seventh meeting of CoC and members were of

the view that the SRS Mall at Sector 12, Faridabad was mortgaged with consortium lenders

and they have first charge over these properties. No specific approval was sought by

corporate debtor from Lenders for sale of these shops. Hence, these shop owners do not

have a valid title to these properties and any agreement for subsequent rent is not deemed

to be valid. The CoC is of the opinion that the ownership of these shops lies with SRS

Limited as CoC holds the first charge over the said shops in the SRS Mall. The shops would

add value to the assets of Corporate Debtor for effective resolution.

Further, RP informed the CoC that Hon'ble NCLT has directed in Applications 7712019 and

7812019 as under:

"In the meanwhile, the Resolution Professional is directed to update the lnformation

Memorandum having been circulated about the pendency of this application and not to

take steps to take possession of shops of applicants".

Accordingly, lnformation Memorandum provided to Resolution Applicants was updated

and no action has been taken for taking possession of the shops of the applicant.

CoC further discussed and was of the view that legal notice should also be sent to the shop

owners for repaying the rent already paid by SRS Limited to them.

Agenda Item No. 5:

To discuss about the present status of resolution plans t o be submitted by shortlisted

resolution ap~licants

As discussed and approved inthe last CoC meeting held on 15.02.2019, the timeline for

submitting the resolution plan by potential Resolution Applicants was extended from

15.02.2019 to 06.03.2019.

I t was also informed by Resolution

resolution applicant namely Movie

Professional that he has received resolution plan ( 6 Times Cineplex Pvt Ltd till 15.02.2019.

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Other resolution applicants had requested for further extension of time for submitting the

plan. It was therefore decided to extend the time till 06.03.2019 to submit the plan and open

all the resolution plans received till date along with Movie Times Cineplex Pvt Ltd on

06.03.2019.

Shri Ashok Kumar Gulla, Resolution Professional informed the CoC that till 06.03.2019 at 11:OO

AM i.e. the last date and time for submitting the resolution plan, plans have been received

from three Resolution Applicants namely Movie Times Cineplex Pvt Ltd, Mr. Devinder Kumar

and Mr. Sahil Virmani.

However, another plan was submitted by Mr. Tinku Singh, Group President and Chief Strategy

Officer of SRS Limited in the meeting itself after 11:OO A.M. CoC and Resolution Professional

discussed the matter and they were of the view that legal opinion must be taken whether Mr.

Tinku Singh is eligible under IBC, 2016 to submit the resolution plan.

The members of CoC also sought information whether all the latest developments regarding

ownership of assets of Corporate Debtor have been updated in Information Memorandum for

carrying out the due diligence by Potential Resolution Applicants.

It was thus decided that the other applicants (mentioned in the final list of eligible resolution

applicants) must be given further time after carrying out due diligence, if any, to submit their

plan. Meanwhile, based on the legal view, a decision shall be taken whether any potential

resolution applicant who was not in the final list of resolution applicants, can also submit

resolution plan, so as to maximise the value under resolution plan.

Thus, time to submit the plan is extended from 06.03.2019 to 13.03.2019. All the plans

received till 13.03.2019 shall be opened in the next CoC Meeting. The matter was put for

voting as Agenda No 10.


Ashok Kumar . Gulla Resolution Professional for SRS Ltd


Agenda Item No. 6:

To discuss cash flow of SRS Limited for the month of Februarv, 2019

Shri Ashok Kumar Gulla, Resolution Professional presented the cash flow statements o f the

Corporate Debtor for the month o f February, 2019 which is presented below:

Cash Flow Statement for the period from 01.02.2019 to 26.02.2019

I Particulars I Amount (in INR Lacs) I I Opening Balance as per Bank Statement (SBI TRA A/C) I 366.59 I I Opening Balance as per Bank Statement (SBI GORAKHPUR A/C) I 87.48

I Box Office I 476.36 I

Opening Balance as per Bank Statement (SBI TAX A/C) 7.53 461.60

I Mall Payment Received I 11.04 I

Food & Beverages BMS &PAMM (PRISTINE & BHIWADI)

I Advertisement Income I 4.00 I

203.66 9.88

( Expenditure I I

Excess Amt. Received from Distributors Other Income

Total Collection (including opening balance)

10.07 1.17

-

1,177.79

I Employee Benefit Expense I 62.15 I

Distributor Share & Commission Charges Raw Material Consumed (Purchase)

162.40 40.96

1 Securitv Expenses I

11.76 I Legal & Professional Professional Fees to RP and IPE

( House Keeping Expenses I 31.53 I

20.58 16.87

I Conveyance Expenses I 0.68 I

Printing & Stationery Telephone Expenses

I Diesel I 0.10 I

0.57 0.52

I CAM I 37.75 I

Mall Payment Advertisement & Publicitv

27.85 1.50

Electricity Lease Rent Paid

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27.40 115.01

-- -

Repair and Maintenance - Others Bms Payment (Roopa Construction Pvt. Ltd.) Cinema License Fees Lucknow Rates & Taxes & Show Tax Payment Bank Charges Taxi Hire Charge

Ashok Kumar Gulla -

Resolution Professional for SRS Ltd

- -- -

10.45 11.00 1.80 0.45 0.42 1.27


TDS, GST & EPF Payment M/o January 2019

Total Outflow

Closing Bank Balance

61.78

644.80 I

Total Surplus/(Deficit)

Anenda Item No. 7:

To discuss the issues of SRS Entertainment lndia Limited

Shri Ashok Kumar Gulla, the Resolution Professional in the Seventh CoC Meeting discussed the

cash flows of SRS Entertainment lndia Limited for the period from September, 2018 to January,

2019. It was also mentioned that company has pending severe liabilities of around Rs 2.80

crores towards GST and TDS which are yet to be paid. Notices for recovery have been issued by

revenue authorities. Due to non-payment of previous liabilities, the company is also not able

to pay the current statutory dues resulting in delay in payment and levy of heavy penalties.

532.99

SBI TRA AfC

SBI GORAKHPUR a / c SBl TAX AfC

TOTAL

Resolution Professional also mentioned about the applicationfiled against SRS Entertainment

lndia Limited ("SREIL") under section 9 of Insolvency & Bankruptcy Code, 2016 in Hon'ble

NCLT, Chandigarh by M/s Raj Pal Theatre located at Muktsar Sahib, Punjab through its partner

Mr. Jagjit Singh, towards non-payment of rent amounting to Rs. 3,28,01,724/-. He informed

CoC that the matter came up for hearing on 27.02.2019. Hon'ble NCLT directed SRS

Entertainment lndia Limited to file the reply. The next date of hearing is 02.05.2019.

438.57 87.48 6.94

532.99

CoC including the representative of Income Tax Office, Operational Creditor discussed in the

seventh CoC Meeting, the cash flows and suggested the representatives from SRS

Entertainment lndia Limited to contact the

company to pay the current dues till the

outstanding liabilities.

statutory author

time they have


-ities requesting them to allow the --

sufficient funds to



Members of CoC also stated that the said subsidiary should also create TDR in bank equivalent

to current outstanding liabilities so as to ensure the availability of funds. It was also

mentioned in the last CoC that as per the books of accounts of SRS Limited, it is showing SRS

Entertainment lndia Ltd as creditor to the extent of Rs.1.81 Crores as on 31.03.2018 and Rs

5.14 Crores as on 21a August, 2018.

The members discussed in detail and again reiterated the view that long term resolution to

this issue may be addressed by the Potential Resolution Applicant.

The cash flows for SRS Entertainment lndia Limited for the period from 01.02.2019 to

24.02.2019, was presented in this CoC Meeting, which is as follows:


Ashok Kurnar Resolution Professional for SRS Ltd


I TOTAL I 142.22 I

Closing Bank Balance

Resolution Professional also informed CoC that in addition to the expenses mentioned in the

above table, SRS Entertainment lndia Limited has paid Rs 28.19 lakhs towards TDS for the

period from April 2018 to December 2018 on 26.02.2019.Cheques with amount aggregating to

Rs 41.78 lakhs have further been issued to various parties which are also yet to be cleared.

Closing Balance (HDFC Bank) Closing Balance (Shivalik Bank)

SRS Entertainment lndia Limited has also paid Rs 11.45 lakhs towards GST for the month of

October, 2017 for Ranchi and Saharanpur. It was further intimated that efforts are made to

clear old statutory dues in a phased manner based on cash flows.

63.82 78.40

CoC was also of the view that directors of SRS Entertainment lndia Limited should get cash

flow audited for two quarters ending on September 2018 and December 2018.

Anenda Item No. 8:

To take note and ratifv the lnsolvencv Resolution Process Costs ("CIRP Cost")

Shri Ashok Kumar Gulla placed the ClRP Cost incurred by RP and his team for the month of

February, 2019:

These expenses are in addition to fees of Resolution Professional, Insolvency Professional

Entity (RBSA Restructuring Advisors LLP), Valuers, Transaction Auditor and Legal counsel

S. NO. 1 2

3

already approved by CoC.

CoC took note of the same and ratified the ClRP Cost.

Details Out of Pocket Expenses by RP & his team for the month of February, 2019 Expenses paid towards booking of venue for 7 CoC Meeting held on 15.02.2019 Video Recording for ~ " C O C Meeting Total


Amount 56,8551- 11,123/-

6,0001- 73,9781-

Ashok Kumar Resolution Professional for SRS Ltd


Anenda Item No. 9:

To discuss such other matters with the permission of maioritv of members of the

Committee of Creditors as may be deemed necessarv for the smooth functioning of the ClRP

of the Corporate Debtor

Shri Ashok Kumar Gulla, Resolution Professional apprised the members of CoC on following

matters:

a. Application filed with Hon'ble NCLT for undervalued and fraudulent transactions

Resolution Professional informed in the last CoC Meeting that Grant Thornton LLP,

Transaction Auditor appointed for Corporate Debtor, had completed the transaction audit

and had identified certain transactions as undervalued under Section 45 and fraudulent

under Section 66 Insolvency and Bankruptcy Code, 2016 ("IBC, 2016"). Grant Thornton

LLP has submitted i ts final report and considering the same, Resolution Professional has

filedthe application with Hon'ble NCLT, Chandigarh seeking appropriate directions under

IBC, 2016.

As per Regulation 35A(3)of IBBl (Insolvency Resolution Process for Corporate Persons)

Regulations, 2016, Resolution Professional has to file the report on the above mentioned

transactions with Hon'ble NCLT by 1 3 5 ~ ~ day from Insolvency Commencement Date which

was 04.01.2019. The applications, therefore, is filed with condonation of delay with

Hon'ble NCLT, Chandigarh.

b. Status of cases filed against operational creditors under Section 9 of IBC. 2016

The matter regarding refiling of caselrestarting of cases under Section 9 of IBC, 2016

against various debtors for jewellery business was discussed during last CoC meetings.

Present status is as under:

a. Lucra Jewels Pvt. Ltd.(Delhi)

Application was filed under Section 9 of IBC, 2016 on 23.01.2018 with

Delhi. Resolution Professional have engaged Lex Advoco to represen




behalf of Corporate Debtor. The matter came up for hearing on 22.02.2019 and

Hon'ble NCLT has reserved the order.

b. Trustworthy Gems & Jewellery Pvt. Ltd.(Delhi)

Application was filed under Section 9 of IBC, 2016 on 16.01.2018 with Hon'ble NCLT

Delhi. Resolution Professional has appointed En Pointe Advisors to represent the case

on behalf of Corporate Debtor. The matter came up for hearing on 22.02.2019 and

Hon'ble NCLT has reserved the order.

c. Gehna Precious Metals Pvt. Ltd. (Delhi)

Application was filed under Section 9 of IBC on 10.01.2018 and was admitted for ClRP

on 28.05.2018 and thereafter was withdrawal on 20.07.2018 upon the application of

IRP i.e. Shri Sudhir Kumar Aggarwal as the Directors of Corporate Debtor was not

traceable and company was not operational. Now, application is being file through En

Pointe Advisors LLP, Legal Counsel to reinitiate the case under section 9 of IBC.

d. Celebration Jewellers Pvt. Ltd. (Delhi)


Chandigarh. Legal notice was served on 01.10.2018 and no reply has been received.

The directors of the company couldn't be contacted. Resolution Professional has filed

the application for restoration of matter along with condonation of delay. Hon'ble

NCLT has issued DastiINotice to the party.

e. Saubhagya Ornaments Pvt. Ltd. (Delhi)


Delhi. Resolution Professional has engaged Lex Advoco to represent the case on

behalf of Corporate Debtor. The matter came up for hearing before Hon'ble NCLT,

New Delhi on 22.02.2019 and it has reserved the order.


Ashok Kumar Resolution Professional for SRS Ltd


f. Vision Jewellers Pvt. Ltd.(Delhi)



The directors of the company couldn't be contacted. Resolution Professional has

filedthe application for restoration of matter along with condonation of delay.

Hon'ble NCLT has issued Dasti/Notiee to the party.

g. Logical Jewellers Pvt. Ltd. (Delhi)


Delhi. Resolution Professional hars engaged Lex Advoco to represent the case on

behalf of Corporate Debtor. The matter came up for hearing before Hon'ble NCLT,

New Delhi on 22.02.2019 and it has reserved its order.

h. Achiever Bullions &Jewellers Pvt. Ltd.



The directors of the company couldn't be contactedResolution Professional has

filedthe application for restoration of matter along with condonation of delay.

Hon'ble NCLT has issued DastiINotice to the party.

i. Satmaya Trading Co. Ltd.

Application was filed under Section 9 of IBC, 2016 on 05.02.2018 with Hon'ble NCLT,

Delhi. The matter came up for hearing on 05.10.2018 and got dismissed for non-

prosecution. Resolution Professional has engaged Lex Advoco to re-open the case

under Section 9 of the IBC, 2016.Resolution Professional is filing a restoration

application in this matter through Lex Advoco, legal counsel.

c. No response to Advertisement

Resolution Professional informed in the last CoC meeting held on

released an advertisement for the post of the professionals such

RBSA Restructuring Advisors LLP RBSA Restructuring Advisors LLP is an IPE Registered with lBBl Resolution professlonil for SRS Ltd


Directors. Few candidates shared their resume for the post of Independent Directors and

CFO, however, after getting to know about the current position of the Corporate Debtor,

none of them agreed to work for the Company. No applications have been received for

the post of CS till date. Efforts are made to appoint CS on the rolls of Corporate Debtor.

Resolution Professional now informed the CoC that Mr Vikas Sharma, accounts consultant

of SRS Limited had agreed for being the CFO. He has been appointed as CFO of SRS

Limited w.e.f. 01.03.2019.

d. Penaltv Notification

The Corporate Debtor has been receiving notices from stock exchanges and SEBl for

various non-compliances made w.r.t disclosures of financial statements for the FY 2017-

18, disclosures under SEBl (Listing Ob&ptbn and Disclosure Raquirements) Regulations

etc. The said regulatow authorities have also levied various penalties for such non-

compliance~. Resolution Professional has been replying to these authorities from time to

time about current situation of company and for waiver of such penalties.

e. Information souaht bv Serious Fraud lnvestiaation Office fUSFIO"]

The Resolution Professional informed CoC that Serious Fraud Investigation Office ("SFIO")

had sought information from him on Corporate Debtor. Resolution Professional had

earlier provided the financial data for the last 10 yearsin soft copy. SF10 has now

requested the Resolution Professional to provide Transaction Audit Report of Grant

Thornton LLP. Resolution Professional, after taking written consent of Grant Thornton

LLP, has provided the report. Further, copy of avoidance application for undervalued and

fraudulent transactions tiled with Hon'ble NCLT, was also made available to SF10 for their

further investigation. Other information is also being made available as and when sought

by SFIO.


Ashok re sol^

Kun ltion

SRS Limfted Minutes of Eight Meeting of CoC

Mr Raju Bansal, Director of SRS Limited also informed that also visited SF10 and provided

information to them. Statutory Auditors of the Corporate Debtor were also called by SF10

to provide them information on the Corporate Debtor.

f. Information from lncome Tax Authority

The representative of lncome Tax Authority have informed about various properties of SRS

Limited being attached with the authority to Resolution Professional vide i ts email dated

15.02.2019. The matter was discussed with the representative of lncome Tax Authority and

it was requested to him that the authority to consider to vacate the attachment order so as

to enable further resolution of the Corporate Debtor. He requested the Resolution

Professional to send an email in this regard for the needful action.

Agenda Item No. 10:

To discuss and take approval for extension of timeline to submit resolution plan from

06.03.2019 to 13.03.2019 in accordance with Regulation 36B of IBBl (Insolvencv Resolution

Process for Corporate Persons) Regulations, 2016

Shri Ashok Kumar Gulla, Resolution Professional informed the CoC about the resolution plans

received till 06.03.2019 at 11:OO AM i.e. the last date and time for submitting the resolution

plan. Plans have been received from three Resolution Applicants namely Movie Times Cineplex

Pvt Ltd, Mr. Devinder Kumar and Mr. Sahil Virmani.

However, another plan was submitted by Mr. Tinku Singh, Group President and Chief Strategy

Officer of SRS Limited in the meeting itself after 11:OO A.M. CoC and Resolution Professional

discussed the matter and they were of the view that legal opinion must be taken whether Mr.

Tinku Singh is eligible under IBC, 2016 to submit the resolution plan.

It was further decided that the other applicants (mentioned in the final list of eligible

resolution

the plan is

applicants) must be

extended from 06.03

given

,2019

further time to

to 13.03.2019.

RBSA Restructuring Advisors LLP RBSA Restructuring Advisors LLP is an IPE Registered with iBBl

submit their ---

Resolution Professional for SRS

mit

Ltd


In terms of Regulation 368 (6) of IBBl (Insolvency Resolution Process for Corporate Persons)

Regulations, 2016, the resolution professional may extend the time for submitting the

resolution plan after taking approval of CoC. Accordingly, following resolution was put for

voting:

"RESOLVED THAT the extension of timeline for submitting the resolution plan by potential

Resolution Applicants from 06.03.2019 to 13.03.2019 is put for approval of CoC"

The above agenda item was voted by all members of CoC, except Union Bank of lndia and

Authorised Representative of Deposit Holders, having 81.86% voting share in favour. In

accordance with Regulation 36B(6) of CIRP Regulations, the date for submitting the resolution

plan can be extended with appwval of CoC having voting share of at least 51%. Thus, the

resolution is said to be approved by members of CoC having 81.86% voting share. E-Voting

shall be conducted by Union Bank of lndia and Deposit Holders.

All the potential Resolution Applicants shall be intimated about the extension of time line.

Conclusion

The meeting ended with note of thanks by Shri Ashok Kumar Gulla, Resolution Professional.

The next meetings shall be conducted to discuss and deliberate further on the resolution

plans received from the resolution applicants. The members of CoC namely Union Bank of

lndia and Authorised Representative of Deposit Holders shall vote on Agenda No 10 through

e-voting. E-Voting shall be conducted from 08.03.2019 at 3:00 pm to 09.03.2019 at 3:00 pm.

ASHOK KUMAR GULLA Insolvency Professional Regn. No: IBBI/IPA-003/IP-N00024/2017-18/10174 RBSA Restructuring Advisors LLP 9C, Hansalaya Builiding,l5 Barakhamba Road, Connaught Place, New Delhi-110001 E-mail: [email protected]; [email protected] Date: 06.03.2019

RBSA Restructuring Advisors LLP RBSA Restructuring Advisors LLP is an IPE Registered with iBBl

Ashok Kurnar Gulla Resolution Professional for SRS Ltd