ibc: the bankruptcy court authorizes the withdrawal of the insolvency plea against Sahara Hospitality

The bankruptcy court on Thursday granted a motion to withdraw from the insolvency resolution process against Sahara Hospitality, after the company and its operating creditor agreed to settle their dispute.

Mumbai-based Sahara Hospitality, owner of Sahara Star Hotel and part of Subrata Roy’s Sahara India Pariwar, has been admitted into the Corporate Insolvency Resolution Process (CIRP) after operating creditor Delta Electro Mechanical has filed a claim claiming default of payment of more than Rs 50 crore by the company.

“This bench is of the view that since the parties have settled the matter fully and finally…nothing survives in the company’s present motion,” observed the Mumbai bench of the National Company Law Tribunal, chaired by Judge PN Deshmukh. “Therefore, the company’s petition is beyond the rigor of the CIRP,” the bench said.

Prior to the passing of the order, Barrister Nausher Kohli, appearing for interim resolution professional Mamta Binani, informed the court that both parties had signed a settlement agreement under which Sahara Hospitality had agreed to pay Rs 8 crore in three installments against all his arrears.

On July 15, the court cleared Delta Electro Mechanical’s application to admit Sahara Hospitality, the flagship hotel of Sahara India Pariwar, into the insolvency proceedings after the company failed to repay dues. around Rs 51.77 crore.

The case was originally filed in 2018 by the operational creditor. It was divested in April 2019 after the company agreed to settle the dispute for Rs 20 crore, to be paid in 14 installments. Subsequently, in September 2019, the operational creditor went to court again after the company failed to meet the agreed terms.

Sahara Hospitality had awarded a work order to Delta Electro Mechanical for the supply, installation, testing and commissioning of the hotel’s HVAC and electrical systems for approximately Rs 32 crore.

After the hotel company failed to pay, Delta Electro Mechanical demanded Rs 51.77 crore along with interest of over Rs 19 crore.

The Sahara Group had acquired this hotel for an undisclosed amount in 2002, when it divested from the Airport Centaur Hotel in Mumbai. The hotel is located very close to the Mumbai airport in the northern suburb of Vile Parle and has over 350 rooms.

Janet E. Fishburn