NCLT defers insolvency hearing as SBI, PC Jeweller explore settlement options

PC Jewller offers to settle its dues to SBI

The National Company Law Tribunal (NCLT) was on December 12 informed that State Bank of India (SBI) and PC Jeweller were exploring settlement options offered by the Delhi-based jeweller.

The lawyers for both the parties jointly sought an adjournment of the insolvency plea at the NCLT, the tribunal has now adjourned the hearing of the plea to January 2024. The jewellery company has offered to pay a sizeable chunk of its outstanding dues spread over a period of three years along with an upfront payment. PC Jeweller owes over Rs. 3,000 crore to SBI.

In November 2023, it was reported that SBI took control of two prime properties in New Delhi, citing default in payments.

In June 2023, SBI moved an insolvency plea against PC Jeweller Limited, NCLT issued notice in the plea and sought for PC Jewller's response. In response to SBI's plea, PC Jeweller filed a 26 volume response to its 19 volume plea.

The plea was, however, not heard on admission to insolvency so far owing to the sheer volume of pleadings and the complexities involved in the case. SBI and PC Jeweller.

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. Loan recall is a process where the source lender requests the return of the amount advanced to the recipient or borrower.

The company, in its annual report for fiscal 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.