The National Company Law Tribunal has ordered liquidation of two Rotomac group companies -- Global and Exports -- whose promoter Vikram Kothari is accused of being involved in a banking fraud. The order was pronounced at the NCLT’s Allahabad chapter. 

The initial period of 180 days expired on March 19 this year, but the committee of creditors has rejected the demand for an extension of 90 days to complete the insolvency resolution process. 

The court has asked the Resolution Professional (RP) to submit a liquidation report within a month, and has appointed the RP -- Anil Goel -- as the liquidator, who will help to auction the company’s assets. 

“The liquidator is directed to submit the progress report of liquidation process within 30 days,” the court said. 

Those companies owe nearly Rs 4,000 crore to banks, including Bank of Baroda, Bank of India and Union Bank of India. 

Besides manufacturing pens, the group is engaged in international merchant trading -- import and export of goods from one country to another. The loans were primarily taken for such trading businesses. 
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No credible resolution plan was drawn up in the six months of NCLT administration and that an entity, which had showed initial interest, did not go ahead with its proposal after the banking fraud involving the pen-maker became public. 

The Rotomac promoter's assets include a few pen-manufacturing sites and collateralized securities. 

Some weeks ago, the Central Bureau of Investigation (CBI) arrested Rotomac owner Vikram Kothari and his son Rahul in the alleged loan default case. The CBI officials said that Vikram and his son, who were called for questioning, were arrested after they failed to cooperate with the investigations. 

Earlier, the CBI had registered a case against Kothari after a complaint was filed by the Bank of Baroda. The CBI case showed that Rotomac owed Rs 754.77 crore to Bank of India; Rs 456.63 crore to Bank of Baroda; Rs 771.07 crore to Indian Overseas Bank; Rs 458.95 crore to United Bank of India (UBI); Rs 330.68 crore to Allahabad Bank; Rs 49.82 crore to Bank of Maharashtra; and Rs 97.47 crore to the Oriental Bank of Commerce (OBC). #casansaar (Source - Economic Times)