Cash-strapped Deccan Chronicle Holdings has received yet another jolt with Yes Bank moving the Debt Recovery Tribunal (DRT) over repayment of the loan it gave the media group in 2010.
The bank had advanced a total of Rs194 crore, of which Rs126 crore is said to be outstanding. The lender’s claim is that the terms of the loan agreement have changed, which entitles it to call for a repayment of the entire amount.
“The Deccan account is still not an NPA and therefore there is no way the bank can invoke the securitisation laws. However, the loan agreement does not allow any changes or violations. As per my understanding, the company should not face any winding up petition, implying it should be in good health. Now that there are some winding up petitions pending against the company in the Andhra Pradesh High Court, it can be construed as a breach of the loan agreement. Therefore, the bank is entitled to recall the loan,” a source explained.
Sources privy to the development said the bank had issued a notice to Deccan on November 30, recalling the entire outstanding. It approached the DRT in Hyderabad, seeking its intervention, after the notice did not result in any payment.
The bank, which has sought repayment of the loan through an original application in the DRT, had also filed an interlocutory application seeking directions to the Board of Control for Cricket in India (BCCI) on disbursal of the receivables.
The interlocutory application has been disposed of, restraining BCCI from paying the money to any other bank.
The original application is expected to come up for further hearing on December 28.
Yes Bank, however, refused to comment or elaborate on the issue. “As a policy, Yes Bank does not discuss specific exposures of the bank and therefore we decline to comment,” a spokesman said.