MUMBAI, APRIL 15: Non-banking finance companies (NBFCs) which have been liberally lending to the corporate sector a few years ago are now very active in filing recovery measures and winding up petitions against their clients as the high default level is becoming painful. Many NBFCs are also filing voluntary winding up petitions as remaining in the business is no longer attractive.While some companies are changing their office from the posh Nariman Point area to the suburbs to get rid of the high rentals or to dispose of the property, investment companies of leading industrial groups are merging with each other. The Hindujas and the Garware group, for instance, have taken legal formalities to merge some of their group investment companies.Lloyds Finance has published a series of public notices claiming ownership of plant and machinery of Parasrampuria International's Pithampur plant in Madhya Pradesh. Through a lease agreement, Parasrampurias obtained delivery of plant and machinery (humidificationsystems for blowing winding and twisting and for carding combing for spinning mill of 249,690 spindles). ``Lloyds Finance is to recover a considerable sum from Parasrampurias towards lease charges, penal interest and default charges. The public notice is given when the company got a hint that there is a move to sell plant and machinery,'' sources said.Parasrampuria's total borrowing to finance its cotton spinning project amounted to a whopping Rs 534 crore. Now the company has filed a case to declare it as a sick company under the BIFR route. Like many other NBFCs, Lloyds Finance has a total outstanding of around 350 crore as leased assets to such companies. The group's oustanding to financial institutions is around Rs 800 crore.Similarly, the winding up petition against Orkay Industries Ltd, filed by the Maharashtra State Financial Corporation for recovering the dues from the company is accepted by the High Court and will come up for hearing soon. Orkay too has huge outstanding to FIs andbanks.Capmark Finance & Guarantees Private Ltd has passed a special resolution to wind up the company under provisions of section 484(1)B of the companies act and that the company be wound up voluntarily! Sunbeam Investments (P) Ltd, another finance company, has filed a voluntary winding up petition to liquidate the company and dispose of the property. Prime Securities Ltd and ASP Ltd too have been engaged in a legal battle over dues. Around 30-40 NBFCs which applied for Reserve Bank licence have already closed their shop and many of them are not responding to the central bank communication.Lloyds Finance, from Lloyds group, has been busy publishing public notices claiming ownership over assets leased to various companies which have not been regularly paying the lease rentals.In the case of Udaipur-based Peacock Industries Ltd, Lloyds Finance through a public notice claims that the company's plant and machinery was leased out as per a lease agreement and that Lloyds is the sold owner of theseproperties. ``Lloyds is entitled to recover a considerable amount from Peacock Industries towards lease charges, penal interest and default charges till February 1998,'' sources said. According to the company, Peacock is trying to sell the leased assets to third parties and the public notice is only a legal formality to ward off buyers for the plant and machinery.
