Under the new Insolvency & Bankruptcy Code, DF Deutsche Forfait has filed a petition with the Mumbai bench of National Company Law Tribunal (NCLT) against the company Uttam Galva for a loan default of Rs 110.4 crore.
Uttam Galva had entered into an agreement with a German company AIC Handels, to buy 20,000 tonnes of prime steel billets. Two bills of exchange were the mode of payment in this trade financing.
AIC Handels hedged its receivables by entering into a discount forfeiting agreement with DF Deutsche Forfait as mentioned in a national news portal.
NCLT may extend the deadline by 90 days, but if there is no agreement among the lenders within the stipulated time, then the defaulting company may go into liquidation, says a market analyst.
The hearing of the petition is scheduled for April 17, for the appointment of insolvency professional, who will constitute the committee of creditors within 30 days of his appointment.