Consortium agreement

Rupendra Porwal (Querist) 26 June 2015 This query is : Resolved
Dear Friends,

One of our client has already availed Fund base facility of 5 cr and non fund base facility of 30 cr from consortium of 4 banks.

After appraisal by lead bank, the Fund base facility increased to 8 cr and non fund base facility increased to 50 cr.

Consortium documents prepared and signed by ONLY 3 BANKS. ONE BANK DID NOT PARTICIPATE AND, THUS NOT SIGNED THE CONSORTIUM DOCUMENTS.

QUERY:

1. What is validity of CONSORTIUM DOCUMENTS signed by only THREE BANKS?

2. Can charge be registered, if yes, what is validity of the charge?

Rupendra Porwal
Advocate
Lucknow-98385 97775

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P. Venu (Expert) 27 June 2015
Your client certainly can afford competent professional advice.

Rajendra K Goyal (Expert) 27 June 2015
Commercial query.

Dalip Singh (Expert) 28 June 2015
(1) The fourth bank has not given any enhanced limit and is also not a party to the consortium hence the fourth bank can ask for refund of the facility given by them earlier.

(2) Charge for the enhanced limit will be registered pari pasu.

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