Gurugram court restrains GoMechanic from alienating its shares
The matter will be heard on 27 February
Gurugram court restrains GoMechanic from alienating its shares
The matter will be heard on 27 February
A Gurugram court has passed an order restraining GoMechanic, a car care solutions company, from alienating its assets or creating any encumbrances on them.
The order came on the petition filed by a lender Equentia Financial Services Private Limited (CredAble) under the Arbitration Act.
The petitioner stated that GoMechanic was an 'obligor' to a facility agreement worth Rs.20 crore provided to one of its group companies, Parcit Auto Crazy Private Limited. However, recent news reports suggested that regarding a sale of the company, GoMechanic was in talks with other creditors.
Rajeev Goyal, the presiding judge of Gurugram's commercial court, said that the stay would remain in force till the next date of hearing.
Equnetia submitted that in July 2022, it executed facility agreements to provide Rs.20 crore as working capital facilities to Parcit. The agreements were based on the condition that to ensure the fulfilment of the obligations, GoMechanic would act as an 'obligor'.
Equentia stated that GoMechanic and Parcit were part of one group and their businesses were intertwined.
The lender stated, "As respondent No.2 (Parcit) was deeply and financially connected with respondent No.1 (Go Mechanic), the petitioner (Equentia) insisted that respondent No.1 become a party to the loan facility agreement in the capacity of an 'obligor'. In fact, in order to assuage the concerns of the petitioner regarding sanctioning the loans, respondent No.1 also agreed to become a corporate guarantor to the facility agreements."
However, on 18 January 2023, certain news reports and a post on the social media account of one of the founders of Go Mechanic revealed that the latter was falsely reporting its financials and inflating its revenue figures.
Therefore, Equentia sought to recall the loan and invoke the bank guarantees. But no action was taken on it.
The plea stated, "Under the terms of the Facility Agreements alienation of assets or shares or creating of any encumbrance either by respondent No.1 or respondent No.2 had to be approved by the petitioner prior to any such alienation. However, the respondents were deliberately not responding to the petitioner's notices and ignoring the negative covenants contained in the Facility Agreements. Such illegal actions of the respondents are likely to cause irreparable harm to the petitioner and it would no longer be able to recover its outstanding obligations."
Equentia was represented by the law firm Trilegal. The advocates included Anuj Berry, Sourabh Rath, and Prerna Acharya. The matter was argued by advocate MK Dang.