Shardul Amarchand Mangaldas advises JC Flowers Asset Reconstruction Private Limited before the NCLT for admission of a petition seeking the initiation of Corporate Insolvency Resolution Proceedings against Reliance Innoventures Private Limited

June 28, 2023

Shardul Amarchand Mangaldas advised JC Flowers Asset Reconstruction Private Limited (“JC Flowers”) before the NCLT (Mumbai bench) for admission of a petition seeking the initiation of Corporate Insolvency Resolution Proceedings against Reliance Innoventures Private Limited (“Corporate Debtor”), one of the ultimate holding companies of the Reliance ADA Group.

This application was filed by the original lender Yes Bank Limited through SAM & Co. under section 7 of the Insolvency and Bankruptcy Code, 2016 (“IBC”) on 18 July 2020. The default amount was approximately INR 100 crores and the cumulative debt due was INR 1000 crores, consisting of term loans and non- convertible debentures. In December 2022, Yes Bank assigned the debt to JC Flowers.

The Corporate Debtor denied the fact of existence of default basis, inter alia, wrongful adjustment by Yes Bank of the sale proceeds of certain pledged shares invoked and sold by Yes Bank and of such sale being conducted at alleged ‘undervalue’ in the manner of a ‘fire sale’. It was further contended that the action was barred under Section 10A of the IBC (in relation to Covid era defaults).

The NCLT rejected the above contentions of the Corporate Debtor, and the petition was admitted on 15 June 2023.

SAM & Co. team was led by Veena Sivaramakrishnan, Partner; Ameya Gokhale, Partner; Parth Gokhale, Partner; Kriti Kalyani, Senior Associate; and Gaurav Karwa, Associate.

Crawford Bayley & Co advised Reliance Innoventures Private Limited.