The Stressed Assets Stabilisation Fund, C/o Principal office, 3rd Floor, filed a petition under Section 95 of the IBC before the Hon’ble National Company Law Tribunal (NCLT), Chandigarh Bench, bearing petition number C.P. (IB) No. 104/CHD/PB/2023 on 28.06.2023 for the initiation of insolvency resolution process against Mr. Sumeet Juneja, Personal Guarantor of M/S Krishna Engineering Works Limited. The said petition was admitted by the Hon’ble Bench vide its order dated 12.09.2024.Mr. Rajinder Kumar Jain was appointed as the Resolution Professional in the matter w.e.f. ____. The order of the Hon’ble NCLT, Chandigarh marked the beginning of the insolvency proceedings against Mr. Sumeet Juneja.
BACKGROUND BEHIND THE INITIATION OF INSOLVENCY PROCEEDINGS AGAINST MR. SUMEET JUNEJA
Mr. Sumeet Juneja, Personal Guarantor of Corporate Debtor – M/S Krishna Engineering Works Limited
M/S Krishna Engineering Works Limited (CIN: L29219PB1983PLC005454, PAN: AABCK0655R) is a Limited Company having its registered office at Ladowali Road, Jalandhar, Punjab - 144001. The Corporate Debtor was incorporated on May 31, 1983. The company is engaged in manufacturing, exporting, and supplying flexible packaging, paper, tire-cord, textile, machinery, and equipment. The company’s products include SG and cast iron products such as helper brackets, hanger brackets, brushes, pins, differential cage, brake drums, hubs, and flywheel assemblies.
Krishna Engineering Works Limited has three plants located in Jalandhar, Punjab. The company has a forge shop equipped with a variety of hammers and hydraulic mechanical presses, with capacities ranging from 100 to 1,000 tons, capable of producing intricate hot-drawn seamless tubes, blind tubes, and shells. The company serves major Original Equipment Manufacturers (OEMs) and caters to the Heavy Commercial Vehicle (HCV) and Multi-Utility Vehicle (MUV) segments. KEWL earns almost all of its revenue from the domestic market, with major domestic customers including Ashok Leyland, Tata Motors, and Punjab Tractors. The company also exports its products to the US, UK, France, Italy, and Germany.
The Company availed credit facilities from various financial institutions, secured by personal guarantees from Mr. Sumeet Juneja and others. However, the company defaulted on its financial commitments, leading to the account being declared a Non-Performing Asset (NPA) on September 30, 2014. Following this, the financial institutions initiated legal proceedings to recover the outstanding debts.
APPLICATION FILED BY STRESSED ASSETS STABILISATION FUND U/S 95 OF THE INSOLVENCY & BANKRUPTCY CODE, 2016
The Stressed Assets Stabilisation Fund filed an application under Section 95 of the Insolvency and Bankruptcy Code, 2016, before the Hon’ble National Company Law Tribunal (NCLT), Chandigarh on 28.06.2023, seeking initiation of insolvency resolution process against Mr. Sumeet Juneja. The application was admitted by the Hon’ble NCLT, Chandigarh on 12.09.2024.
IMPOSITION OF MORATORIUM U/S 101 OF THE CODE
With the admission of the application under Section 95, a moratorium has commenced in relation to all debts of Mr. Sumeet Juneja. Pursuant to the imposition of moratorium under Section 101 of the Code, no legal proceedings can be initiated or continued against the personal guarantor in respect of any debt; and the personal guarantor is barred from transferring, alienating, encumbering, or disposing of any of his assets or his legal rights or beneficial interest therein.