SRF Limited has filed an application under Section 9 of the Insolvency and Bankruptcy Code (IBC), for initiating the Corporate Insolvency Resolution Process (CIRP) against Birla Tyres
The National Company Law Tribunal (NCLT) Kolkata Bench has ordered to initiate insolvency proceedings against BK Birla group company – Birla Tyres, admitting an insolvency petition of SRF Limited, an operational creditor of the tyre maker.
The application filed by SRF, under Section 9 of the Insolvency and Bankruptcy Code (IBC), for initiating the Corporate Insolvency Resolution Process (CIRP) against Birla Tyres, the corporate debtor, is admitted, said the NCLT Kolkata bench in its order dated May 5, reports LiveLaw.
Birla Tyres Ltd, a part of BK Birla Group of Companies, was incorporated as a part of Kesoram Industries Ltd in 1991 but was later demerged in 2018. In Financial Year 2021, Birla Tyres had made losses to the tune of Rs 287.63 crore and SRF Ltd, the Operational Creditor, had supplied Tire Cord Fabric to Birla Tyres Ltd, Corporate Debtor, between 2018 -19. However, when the payment against the supplies were not received, the Operational Creditor had served a Demand Notice to them.
“SRF has outstanding dues of over Rs 15 crore from Birla Tyres as the company supplied nylon tyre cords. The company filed the insolvency petition against Birla Tyres for default of making the payment,” said SRF’s advocate Iram Hassan, reports Financial Express.
Birla Tyres’ management did not comment on this.