LUCKNOW: While Rotomac Global owner Vikram Kothari and his son are going through the rigors of investigation, another Kanpur-based firm, Shri Lakshmi Cotsyn Limited, has landed in a soup by failing to pay off the loan of Rs 3,972 crore borrowed from a consortium of 16 banks led by the Central bank of India.
Other banks of the consortium are Syndicate Bank, Union Bank, Canara Bank, Bank of Baroda, Punjab National Bank, Indian Bank, State Bank of India, Exim Bank, Oriental Bank of Commerce, IDBI Bank, Vijaya Bank, Corporation Bank, Saraswat Bank and Andhra Bank. Moreover, Edelweiss Estate Reconstruction is also the part of the consortium.
According to sources, Central Bank of India, leading the consortium, was the first one to reach Debt Recovery Tribunal (DRT) and later National Company Law Tribunal (NCLT) on November 30, 2016 to facilitate the compromise considering the firm to be a sick unit. However, now the bank has already started auctioning firm’s assets for the recovery of money due on it.
The firm has five factories across the state, including four in Fatehpur and one in Noida. Besides, two other factories are in Roorkee (Uttarakhand) and Sonepat (Haryana). The firm mainly manufactures textile and defence products including military uniform.
Refuting reports of turning defaulter of Rs 3,972 crore loan money, group chairman and managing director, MP Agarwal said that the principal amount of the loan was Rs 2,600 crore excluding all interests. “My company has taken the loan and we shall repay it. No doubt, we are reeling under financial stress since 2012, but the situation is very much under control. We have all the intentions to repay the amount by doing extra production,” he maintained. Agarwal added that the units and company’s peripheral assets were worth Rs 3,000 to 4,000 crore. He claimed that nearly 3,500 employees were there with the group and their salaries, wages and dues were being released regularly every month.
However, according to official records of banks, the firm started incurring losses and skipping repayment of loan amount in 2013. As a result, it was declared wilful defaulter by the banks. Meanwhile, it surpassed the capital amount which led to grim chances of the revival of the company.