Hope to settle bank dues in two-three months, says Kanpur-based firm on allegations of not paying Rs 3972 crore loan

A consortium of 16 banks, led by Central Bank of India, which had loaned Kanpur based firm - Shri Lakshmi Cotsyn manufacturing defence products.

Published: 30th March 2018 10:17 PM  |   Last Updated: 30th March 2018 10:17 PM   |  A+A-

A cashier displays the new 2000 Indian rupee banknotes inside a bank in Jammu, November 15, 2016. (Photo | Reuters)

For representational purposes (File | Reuters)

Express News Service

LUCKNOW: The consortium of 16 banks, led by Central Bank of India, which had loaned Kanpur based firm - Shri Lakshmi Cotsyn manufacturing defence products, had called a meeting of the officials of all member banks recently in Delhi in connection with non-payment of loan amount to the tune of Rs 3972 crore, due on the firm.

The consortium, which has declared the firm a Non-Performing Asset (NPA), discussed ways to recover the loan amount.

As per senior officials of the firm, the company informed the consortium that it had signed an agreement with a couple of investors and assured to arrange not only the working capital but other expenses also towards the settlement of loan amount.

The banks agreed that the firm should be allowed to run its units so that it could fetch the instalments towards the repayment of the loan.

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. The consortium leader Central bank denied having moved against the company to National Company Law Tribunal (NCLT).

"We have declared the firm NPA but its three units are running though at meagre level,” said DGM, Cental Bank, AD Srinivasan. He added that so far no petition regarding loan default was filed at NCLT, Allahabad.

On the other hand, 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,” he averred.

“We hope to settle the issue to the satisfaction of banks in coming 3-4 months as we have worked out deals with 2-3 promising investors,” said the chairman.

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.

“With the loan amount we set up our factories and all the company assets are mortgaged to the banks. The units are running smoothly and the income money is being routed to company’s loan account in Central Bank of India which, in turn, pays off to other banks,” said the chairman.

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