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15 companies show interest to buy debt-laden SRS Ltd under IBC

Dipak Mondal     January 15, 2019

As many as 15 buyers have shown interest in buying SRS Limited, the Faridabad-based real estate, retail and cinema exhibition company against which insolvency proceedings have been started by banks for defaulting on a loan of Rs 1,100 crore.

Those which have shown interest include asset reconstruction companies (ARCs) ARCIL and JM Financial ARC, and real estate company Omaxe Limited. Out of the 15, five are ARCs, others include real estate firms, cinema exhibition companies and individuals.

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Ashok Gulla, the insolvency resolution professional (IRP), has so far received claims of Rs 1,300 crore including Rs 1,060 crore from six financial creditors, Rs 146 crore from tax authorities, Rs 81 crore from depositors and Rs 37.5 crore from operational creditors.

Of the total loan of Rs 1060 crore, SRS Ltd owes Rs 628 crore to State Bank of India, Rs 224 crore to Bank of India and Rs 125 crore to Union Bank of India.

SRS Limited, which is part of the SRS group that has over 300 subsidiaries, is owned by Anil Jindal. Jindal, who is the chairman and managing director, is in jail on charges of cheating and fraud.

The promoters of the company are accused of diverting money from the company. An audit of the transactions of the company was ordered by the Committee of Creditors (CoC) in September. The CoC has hired Grant Thornton as transaction auditor.

The CoC in its meeting during 27 December last year discussed the findings of the transaction audit submitted by Grant Thornton. The transaction audit found many inconsistencies and anomalies including the company's relationship with debtors and vendors, high debtors provisioning, non-existent debtors, unexplained write-offs of assets, etc.

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