Axis Bank expects to recover ₹100 crore from the financially troubled Deccan Chronicle Holding Ltd (DCHL) as it has filed a cheque bouncing case against the publisher.

Two cheques worth ₹60 crore and ₹40 crore each submitted last year by DCHL to Axis Bank had bounced. Subsequently, the bank filed a case against DCHL under Section 138 of the Negotiable Instruments Act.

“Section 138 is our Brahmastra (most lethal weapon used in Indian mythology). It is a powerful tool with which we can at least recover some of our dues,” said an official with the bank who didn’t want to be named. Action under Section 138 leads to a non-bailable warrant.

The private sector lender had filed a case in the Andhra Pradesh High Court against DCHL, which owes it ₹409 crore.

The bank has already attached the promoter’s personal property worth ₹60 crore. Multiple lenders are fighting for possession of the Hyderabad-based DCHL’s other attached properties.

Axis Bank has named it a wilful defaulter. The bank official said that borrowers often frustrate lenders by buying time through legal extensions and reliefs.

The official added that the debt-laden publisher was generating some cash flows since it has been conducting its core operations without any disruptions.

In 2012, the Hyderabad-based publisher has defaulted on total loans worth about ₹4,200 crore taken from 28 lenders. The other lenders include ICICI Bank with largest exposure at ₹490 crore, followed by Axis Bank (₹409 crore), Canara Bank (₹360 crore), IDBI Bank (₹260 crore), among others. Most lenders are fighting litigations against the company in the Andhra High Court.

Earlier, this month, DCHL’s board approved the sale of shares to prospective investors on a preferential allotment basis.

The firm is hunting for strategic investors to rescue itself from its liabilities.

The Hindu Business Line competes with The Financial Chronicle.

Related Topics