HC declares Orbit Corporation's father-son director duo insolvent

MUMBAI:

Bombay high court

has declared Ravikiran and Pujit Agrawal, the father-son duo of Orbit builders, insolvent. Justice S C Gupte passed the order on May 26 in an insolvency petition they filed last year, as debtors.


Both, father and son, claimed to be indebted under a

consent decree

of June 2015 for Rs 56 crore to

Vardhaman Developers Ltd

along with interest and penalties.

The HC declared them insolvent since it said their liabilities were far in excess of their assets.

Vardhaman Developers objected to the petitions by Agrawals. It held a decree against them and in submissions made through counsel VR Dhond, accused the Agrawals of not only making false statement but of "trying to create fictitious liabilities" and failing to make full and complete disclosure.

The HC said, "none of the objections of the objectors has any merit," and proceeded to accept submissions made by Agrawals’ counsel

Cherag Balsara

to hold that the debtors complied with all requirements of law for presentation of their petitions.

The HC said, "There is an indisputable act of insolvency on their part….They owe debts of well over the statutory minimum amount. There is a subsisting attachment order of court in pursuance of a decree of court in respect of their property. They have both clearly alleged inability to pay their debts, which are huge, to say the least."

The HC appointed an ‘Official Assignee’ for the properties of the Agrawals and directed him to "steps in insolvency including realisation of properties and making of investments."

The HC turned down a plea by Dhond, for Vardhaman Developers, to stay its order. The HC said it would not be in the interest of justice to stay the order of insolvency, once passed.

By the HC order, Vardhaman cannot execute its decree and will have to lodge its claim with the official assignee. Such claim will however, now rank on the same footing with other creditors.


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