This would be another case where recoveries are likely to be less than 5% of total exposure, estimated at around Rs 1,500 crore.
The Mumbai Bench of National Company Law Tribunal (NCLT) ordered the liquidation of the entity, one of the group companies promoted by Choksi. The court appointed Santanu T Ray, senior partner of AAA Insolvency Professionals LLP, as the liquidator of that company. Prior to the liquidation order, Vijay Kumar Garg was appointed a resolution professional responsible for the corporate insolvency resolution process.
Over 70 percent of lenders voted in favor of liquidation, encouraging the PR to file for liquidation.
“In view of the decision of the Creditors Committee (CdC), we are inclined to initiate liquidation proceedings against the debtor company,” the court said in the order.
The ruling follows an insolvency claim, filed by ICICI Bank in 2018 against the company, which was allegedly involved in a money laundering case reported by the Punjab National Bank. The insolvency petition filed against Mehul Choksi’s parent company, Gitanjali Gems, is pending judgment in the dedicated insolvency court.
“The liquidator started the liquidation process by searching for related documents,” said a banker.
Nakshatra’s trademark resolution process had to overcome many obstacles. The Ministry of Corporate Affairs had filed an application against the company for instructions for the recovery of the amounts of financial fraud, following which the Court issued an ex parte injunction order prohibiting the debtor company from withdraw, transfer or dispose of funds and assets. . As the properties and assets were in the control and custody of the authorities, the PR was unable to complete the resolution process effectively.
“We will do our utmost to release the mortgaged assets to financial creditors using our experience of other companies to expedite the detachment and sale of assets for distribution to stakeholders,” said Anil Goel, Founder of AAA Insolvency Professionals LLP.