The National Company Law Tribunal (NCLT) on August 21 deferred to August 29, the hearing of State Bank of India's (SBI) plea seeking insolvency proceedings against PC Jeweller.
The case was adjourned after PC Jeweller sought more time to file a response to SBI's plea.
On August 2, the NCLT first sought PC Jeweller's response to SBI's plea.
SBI's insolvency plea first came up for hearing on July 26, the tribunal issued notice in the case and listed the case for further consideration on August 2. PC Jeweller entered an appearance in the case today and sought time to file a response, and the tribunal accordingly deferred the hearing in the case.
PC Jeweller's troubles began in February 2023, when banks decided to recall loans advanced to it after it was revealed in a filing that the company had defaulted on loans worth Rs 3,466 crore from banks and financial institutions. A loan recall is a process where the source lender requests the return of the amount advanced to the recipient or borrower.
Generally, when lenders see problems in a borrower’s financial situation, they decide to recall loans.
The company, in its annual report for fiscal year 2021-22, stated that it had borrowed money from 14 banks, including SBI, Indian Bank, Union Bank and Punjab National Bank.
In the annual report, the company said it owed the banks Rs 3,278 crore, which included the interest and the base amount.
The largest lenders are SBI, with Rs 1,060 crore outstanding; Union Bank of India, with Rs 530 crore; Punjab National Bank, with Rs 478 crore; and Indian Bank, with Rs 226 crore.
The company has also found itself in trouble with the Securities Exchange Board of India (SEBI) over insider trading allegations. On February 2 this year, SEBI had sought a clarification from PC Jeweller on its price movement in the market, after the company’s shares fell from Rs 48 at the start of the trading session to Rs 43.50 at the end of the session.
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