X Bank Limited -Versus- Y Products Limited

IN THE COURT OF ADDITIONAL DISTRICT JUDGE

AND BANKRUPTCY COURT, DHAKA

BANKRUPTCY CASE NO. _______ OF 1999

X Bank Limited

Motijheel Branch

BSB Bhaban

8 RAJUK Avenue

P.S. Motijheel

Dhaka

PLAINTIFF/CREDITOR

-Versus-

1. Y Products Limited

618/A Bara Maghbazar

P.S. Ramna

Dhaka

2. Md. Z

Son of Q

622 Bara Maghbazar

P.S. Ramna

Dhaka

3. A

Son of Q

622 Bara Maghbazar

P.S. Ramna

Dhaka

4. B

Son of Q

618/A Bara Maghbazar

P.S. Ramna

Dhaka

5. Md. C

Son of Late P

618/A Bara Maghbazar

P.S. Ramna

Dhaka

DEFENDANTS/DEBTORS

SUIT FOR ADJUDGING/DECLARING THE DEFENDANTS/DEBTORS BANKRUPT UNDER

BANKRUPTCY ACT, 1997

SUIT VALUED AT TK. ____AS ON __________.

The plaintiff/creditor above named states as

FOLLOWS:

1. That the plaintiff/creditor is a banking company incorporated under the Companies Act, 1913 having its Head Office at BCIC Bhaban, 30-31, Dilkusha C/A, Dhaka. It carries on banking business within the territory of Bangladesh as well as abroad through its various branches including the Motijheel Branch, Dhaka (hereinafter called the plaintiff/creditor bank), whose address is stated in the cause title.

2. That the defendant/debtor No. 1 is a limited company incorporated under the relevant Companies Act, and carries on various businesses from its business office situated at the address stated in the cause title. The defendant/debtor Nos. 2 to 5 are directors of the defendant/debtor No. 1 company and are guarantors for the repayment of credit facilities availed by the defendant/debtor No. 1 company from the plaintiff/creditor bank.

3. That the defendant/debtor No. 1 availed various credit facilities from the plaintiff/creditor bank. The defendant/debtor No. 1 company as well as the defendant/debtor Nos. 2 to 5 executed all necessary charge documents in favour of the plaintiff/creditor bank for repayment of loan liabilities. However, the defendants/debtors failed to repay their outstanding liabilities with the plaintiff/creditor bank, notwithstanding a series of requests and reminders as well as legal notice served by and on behalf of the plaintiff/creditor bank.

4. That the plaintiff/creditor bank was therefore constrained to file a money suit, being Money Suit No. 152 of 1995, in the Court of Subordinate Judge and Artha Rin Adalat No. 3 against the defendant/debtors for recovery of Tk. 6,08,42,564.95 (Taka six crore eight lac forty two thousand five hundred and sixty four and paisa ninety-five) only as on 30.09.95 plus interest and cost, which was the outstanding liabilities of the defendant/debtor No. 1 with the plaintiff/creditor bank against various credit facilities availed by the defendant/debtor No. 1’s from the plaintiff/creditor bank upon the security of, inter alia, guarantees given by the defendant/debtor Nos. 2 to 5.

5. That after the said suit was filed, the defendant/debtor Nos. 1 to 5 appeared in and contested the said suit and thereafter approached the plaintiff/creditor bank for amicably compromising the case out of court. The plaintiff/creditor bank agreed to such compromise, and on 08.01.96 the plaintiff/creditor bank and the defendants/debtors jointly filed a petition of compromise embodying the following terms and conditions:

(i) A sum of Tk. 6,08,42,564.95 (Taka six crore eight lac forty two thousand five hundred and sixty four and paisa ninety-five) only (suit value) would be paid by the defendants/debtors jointly and/or severally in full and final settlement of the claim. Before the petition of compromise was filed, the defendants/debtors had already paid Tk. 63,00,000.00 (Taka sixty three lac) only being 10% of the amount due and the balance amount of Tk. 5,45,42,564.95 (Taka five crore forty five lac five hundred and sixty four and paisa ninety five) only was supposed be paid in eleven half yearly installments, which included 14% simple interest payable annually as per the following schedule:

Repayment Schedule/date
10% down payment (by 08.01.96) : Tk. 63.00 lacs
1st installment, December ’96 : Tk. 20.00 lacs
2nd installment, June ’97 : Tk. 25.00 lacs
3rd installment, December ’97 : Tk. 30.00 lacs
4th installment, June ’98 : Tk. 40.00 lacs
5th installment, December ’98 : Tk. 45.00 lacs
6th installment, June ’99 : Tk. 50.00 lacs
7th installment, December ’99 : Tk. 60.00 lacs
8th installment, June ’2000 : Tk. 70.00 lacs
9th installment, December ’2000 : Tk. 60.00 lacs
10th installment, June ’2001 : Tk. 67.00 lacs
11th installment, December ’2001 : Tk. 100.00 lacs

Interest was to be calculated at simple interest rate and charged annually, which would be paid in lump sum with the last installments. Balance outstanding, if any, was be adjusted with the last installment, within 30.12.2001.

(ii) The interest to be charged on the aforesaid balance amount during this period was to be at the rate of 14% simple interest or at such rate as the plaintiff/creditor bank might have charged from time to time. If there were to be default in payment of two installments or part thereof, the suit would be decreed for the entire amount of Tk. 6,08,42,564.95 (Taka six crore eight lac forty two thousand five hundred and sixty four and paisa ninety-five) only as on 30.09.95 plus interest and cost as per the plaint in the said suit and the defendants/debtors would be liable to pay the said decretal amount with normal banking interest from 1st October, 1995 till the entire amount was liquidated. In other words, in the event there was default in payment of two installments or any part thereof, the concession given to the defendants/debtors would stand withdrawn.

(iii) The guarantees given by the defendant/debtor Nos. 2 to 5 for repayment of the loan liabilities of the defendant/debtor No. 1 would continue until realisation of the entire decretal amount.

(iv) If the interest were to be enhanced in the future, the defendants/debtors would jointly and/or severally pay the said amount with the last installment.

(v) The securities and documents executed by the defendants/debtors would continue until repayment of the decretal amount.

6. That the learned Court of Subordinate Judge and Artha Rin Adalat No. 3 was pleased to pass decree in accordance with the terms and conditions prayed in the joint petition for compromise made by the plaintiff/creditor bank and the defendants/debtors as aforesaid vide decree dated 23.01.96. As such the liabilities of the defendants/debtors became unequivocally admitted and acknowledged by the defendants/debtors.

7. That notwithstanding the passage of compromise decree as aforesaid upon the joint petitions of the plaintiff/petitioner bank and the defendants/debtors, the defendants/debtors has not made payment of even one installment since the compromise decree was passed on 23.01.96. As such it is now evident that the defendants/debtors never had any bona fide intention of settling their acknowledged debt with the plaintiff/creditor bank, and that the defendants/debtors entered into the compromise decree as aforesaid with the mala fide intention of frustrating and delaying the recovery by the plaintiff/creditor of its legitimate dues.

8. That the failure of the defendants/debtors to pay the second installment or part thereof took place on 30.06.97, and thereby they failed to comply with the terms and conditions of the compromise decree that was passed upon compromise. Therefore, as per the terms and conditions of the compromise decree, the suit became decreed for Tk. 6,08,42,564.95 (Taka six crore eight lac forty two thousand five hundred and sixty four and paisa ninety-five) only as on 30.09.95 plus interest and cost as per the plaint in Money Suit No. 152 of 1995. Of this amount Tk. 63,00,000.00 was already paid prior to the passage of the compromise decree. Therefore, the actual amount owed by the defendants/debtors to the plaintiff/creditor bank as on 01.10.95 stood at Tk. 5,45,42,564.95 (Taka five crore forty-five lacs forty two thousand five hundred and sixty four and paisa ninety-five) only.

9. That in view of the negative and evasive attitude of the defendants/debtors, the plaintiff/creditor bank was constrained to serve notice under Section 9(1)(i) of the Bankruptcy Act 1997 dated 08.02.99 upon the defendants/debtors in the prescribed form by registered post demanding payment of Tk. 5,45,42,564.95 (Taka five crore forty-five lacs forty two thousand five hundred and sixty four and paisa ninety five) only as on 01.10.95 plus interest at the rate of 16.50% (as per plaint) within 90 days of receipt. However, the said notices were returned unserved, as the defendants/debtors did not receive them.

10. That in view of the above, the plaintiff/petitioner caused notices under Section 9(1)(i) of the Bankruptcy Act 1997 to be published in the Daily Sangbad dated 01.04.99 and Daily Bhorer Kagoj on 04.04.99 whereby the defendants/debtors were once more called upon to make payment of Tk. 5,45,42,564.95 (Taka five crore forty-five lacs forty two thousand five hundred and sixty four and paisa ninety five) only as on 01.10.95 plus interest at the rate of 16.50% within 90 days.

11. That notwithstanding the elapse of 90 days since issuance of the notice through registered post and newspaper publications on 09.05.99 and on 29.06.99 and 02.07.99 respectively, the defendants/debtors have not made payment of the demanded amount nor have they paid deposited any amount whatsoever towards payment of the decretal amount as per compromise decree. As such it is evident that the defendants/debtors are unable/not willing to pay their debts.

12. That the plaintiff/creditor bank is an eligible creditor within the meaning of the Bankruptcy Act 1997 and the aggregate amount of the debts owed to it being Tk. 5,45,42,564.95 (Taka five crore forty-five lacs forty two thousand five hundred and sixty four and paisa ninety five) only as on 01.10.95 plus interest at the rate of 16.50%, the aggregate debt exceeds the minimum Tk. 5,00,000.00 stipulated in the Bankruptcy Act 1997 necessary for filing bankruptcy suit. The defendants/debtors not having complied with notice issued/published under Section 9(1)(i) of the Bankruptcy Act 1997 in the form prescribed within 90 days, they have committed an act of bankruptcy within the meaning of Section 9(1) of the Bankruptcy Act 1997. The failure of the defendants/debtors to comply with the notice issued/published under Section 9(1)(i) of the Bankruptcy Act 1997 has occurred within the period specified in Section 12(1)(c) of the Bankruptcy Act, 1997. The registered office and/or place of business/residence of the defendants/debtors are situated in Dhaka and as such they are amenable to the territorial jurisdiction of this learned Court. In the premises stated, the plaintiff/creditor bank, being an eligible creditor, is lawfully entitled to obtain an order of adjudication from this learned Court adjudging the defendants/debtors as bankrupt.

13. That the claim of the plaintiff/creditor bank, after application of 16.5% interest, stands at Tk. ____________________ (Taka _________________________________) as on _________, which the defendant/debtor No. 1 is liable to pay as principal borrower and defendant/debtor Nos. 2 to 5 are jointly and severally liable to pay as guarantors, and hence the defendants/debtors are liable to be adjudged as bankrupts unless they liquidate the liabilities immediately.

14. That the cause of action to file this suit arose on 08.02.99 and on 01.04.99 and 04.04.99 when notice under Section 9(1)(i) of the Bankruptcy Act 1997 was issued and published respectively by the plaintiff/creditor bank and on 09.05.99 and on 29.06.99 and 02.07.99 when 90 days since issue/publication elapsed.

Wherefore the plaintiff/creditor bank prays for the following reliefs :-

(a) To adjudge the defendants/debtors as bankrupt.

(b) To declare that the defendants/debtors are jointly and/or severally liable for the amount of Tk. __________ (Taka __________________________ _____________) only as on ________________ to the plaintiff/creditor bank.

(c) To award compensation @ 16.5 % per annum from __________ till realisation.

(d) To appoint receiver/interim receiver to take custody of the properties, if any, of the defendants/debtors.

(e) To direct the receiver to allow sale of the properties of the defendant/debtors and utilise the proceeds of the same towards adjustment of the plaintiff/creditor bank’s dues.

(f) To put the defendant/debtor Nos. 2 to 5 in civil prison if the sale proceeds of the properties of the defendant/debtors are not sufficient to meet the liabilities.

(h) To award cost of the proceedings.

And any other relief or relief’s as the learned Court may deem fit and proper.

SCHEDULE OF CLAIM

As per latest statement of account the amount payable by the defendants/debtors to the plaintiff/creditor bank stands at Tk. ___________________ (Taka ____________________ ____________________) only as on ___________.

VERIFICATION

That the statement made hereinafter are true to our knowledge and in witnesses whereof we sign this verification on this the ____________ the day of __________, 1999 sitting in the Bank’s premises at Dhaka.

____________________________________

For : X BANK LTD.

Motijheel Branch

BSB Bhaban

8 RAJUK Avenue

P.S. Motijheel

Dhaka

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