Union bank

Ready to make single settlement with Union Bank of India: Supertech at NCLAT

Real estate developer, Supertech proposed before the National Company Law Appellate Tribunal (NCLAT) on Tuesday that it was ready to reach a single settlement with the lender – Union Bank of India.

Union Bank of India sued Supertech in NCLAT after the company failed to repay its debt in July 2019. Supertech challenged the same in the Appellate Court. The amount of default, as of January 2021, stands at Rs 432 crore. In the past, the Bank had rejected similar proposals from Supertech four times, most recently on April 4.

In a hearing on Tuesday, Supertech asked for a week to “sit down and try to resolve the issue with the bank.”

Appearing for the company, lead attorney Arun Kathpalia also urged the NCLAT bench to order the resolution professional not to form the creditors’ committee (CoC) until the next hearing, scheduled for April 19, because it will escalate and have “serious repercussions” on homebuyers.

“To date, in none of the major real estate projects, no insolvency has resulted,” said the lead attorney.

Heeding Kathpalia’s request, the three-member bench of the NCLAT, led by its chairman, Justice Ashok Bhushan, said in its order, “Until the next date, the IRP will not constitute the CoC.”

Supertech has 28 ongoing projects. Regarding one, Section 7 of the IBC was filed by the Union Bank of India. There are 38,000 apartment buyers for its projects and so far it has only delivered 11,000 apartments.

Bishwajit Dubey, appearing for the IRP, said 10,000 applications had been received by the IRP through April 8 and the CoC was likely to be formed next week.

Between 2013 and 2016, Supertech availed of two credit facilities, totaling Rs 250 crore, from Union Bank to part finance a group housing project, Eco Village -II, in Greater Noida.

Supertech failed to make a timely repayment and subsequently UBI declared it a non-performing asset (NPA). The notice was also sent under the SARFAESI Act in April 2019.