Fresh Hope For Lavasa as NCLT Orders Restart of Insolvency Process

                I
Implementation of the resolution plan 
approved by NCLT, Union Bank of India, a 
secured creditor, and on behalf of the secured 
financial 
creditors of Lavasa also filed an IA. Union Bank 
submitted that due to the non-infusion of 
funds, the lender banks were forced and 
constrained (to maintain the CD) to infuse 
money into Lavasa. Accordingly, in the 
meeting, 62.73% of the lender banks agreed 
that the 
performance bank guarantee (PBG) submitted 
by DPIL should be invoked and encashed. 
Subsequently, ARCIL also indicated their 
approval for the invocation of the PBG of Rs25 
crore, so there was a consensus of 73.65% of 
the lender banks in favour of the 
invocation of PBG.
 
The NCLT bench observed that Darwin 
Platform not only failed to make the upfront 
payment as required under the approved 
resolution 
plan but also failed to take any real steps even 
after the dismissal of appeals by the National 
Company Law Appellate Tribunal 
(NCLAT) on 10 January 2024 while hearing an 
appeal filed by Union Bank and on 13 February 
2024 while hearing the appeal filed by 
State Bank of India (SBI). 
 
"The PBG was invoked by Union Bank on 8 
April 2024, i.e., many days after the rejection of 
the appeals. This clearly demonstrates that 
the Darwin Platform was never ready to 
implement the plan and was only making 
excuses to somehow save the PBG amount. In 
the 
light of the discussion, we have no hesitation 
in holding that Darwin Platform has starkly 
contributed to the failure of implementation 
of the approved resolution plan in accordance 
with the terms of the approved resolution plan. 
Consequently, Union Bank has rightly 
invoked and encashed the PBG furnished for 
by Darwin Platform, and the proceeds thereof 
can be used for the purposes as decided by 
CoC," NCLT says.
 
As per the approved resolution plan, Darwin 
Platform was required to make an upfront 
payment of Rs100 crore within 90 days from 
the 
effective date, the date of approval of the 
resolution plan, and receipt of a copy of the 
order and a payment of the further amount of 
Rs50 crore within nine months from the 
effective date. 
 
A group of more than 500 homebuyers in 
Lavasa had filed an appeal alleging serious 
irregularities in Lavasa's resolution plan. It 
included fudging of figures and 
misrepresentation of facts, which comprises 
of fudging of net-worth, share capital and long-
term 
liability figures, misrepresentation in the 
valuation of shares and inconsistencies in 
filings with the Union ministry of corporate 
affairs 
(MCA).
 
NCLT also dismissed IA filed by employees of 
Lavasa, stating that the applicants lack the 
locus and there is no question of considering 
their apprehensions. 
 
Earlier in March, the enforcement directorate 
(ED) descended upon the Darwin Platform 
group, conducting raids across nine locations 
in Delhi, Mumbai and Goa, seizing cash worth 
around Rs78 lakh, incriminating documents 
and foreign currency of Rs2 lakh from the 
residence of Ajay Harinath Singh and his 
associates. 
 
The ED alleges the transfer of nearly Rs18 
crore through layered transactions involving 
multiple accounts linked to the Darwin group 
and personal accounts of the Singh family and 
associates. The Darwin group also stands 
accused of being the primary beneficiary of 
funds routed through Dlehman Rea-IT Trade 
Pvt Ltd, adding weight to the money laundering 
charge. 
As reported by Moneylife, Mr Singh claims that 
the Darwin Platform group of companies is in 
the business of refineries, infrastructure, 
automobiles, defence, pharmaceuticals, 
airlines, electric vehicles, banking, finance and 
media – but has seldom mentioned that the 
group's primary source of income is multi-level 
marketing (MLM) or collective investment 
schemes (CIS). 
 
In fact, Darwin Platform Refineries, which is 
ostensibly its 'refinery business', is also into 
direct sales that resemble MLM or Ponzi 
business modules.