Panjaab Transport Placed in Receivership After Cash Diversions, Liens and CRA Audit Concerns

The Ontario Superior Court (Commercial List) appointed msi Spergel Inc. as receiver over 8777691 Canada Inc. o/a Panjaab Transport and 2747826 Ontario Inc. on October 9, 2025, on application by Royal Bank of Canada. The order followed a three-week interim receivership that began September 19 to secure books and establish visibility into the debtors’ affairs.

Panjaab operates a trucking and logistics business; 274 owns the real property at 2101 and 2213 Ninth Line, Oakville. Sandeep Singh is the sole director of both entities. The debtors told the Court they employ roughly 80 employees and 60 contractors.

RBC’s application traced a rapid deterioration through mid-2025: internal reporting became inconsistent and unverifiable; receivables and deposits fell sharply; and drawings on the revolver exceeded the margin by about $2.164 million. RBC issued non-tolerance letters in June and August, delivered demands and s.244 notices on September 4, and remained unpaid. As at late August, RBC calculated indebtedness of approximately CAD $12.254 million plus USD $17,766 across the Panjaab and 274 facilities, secured by GSAs and first mortgages over the Oakville properties.

During the interim period, msi Spergel Inc. reported multiple red flags: receivables being redirected to pay suppliers; new operating accounts opened at another bank in August despite prior assurances to the contrary; and a sudden wave of lien registrations—nearly $700,000—purporting to prime secured collateral. The Interim Receiver also highlighted a CRA HST audit proposing to disallow significant input tax credits and levy a gross-negligence penalty of about $600,000, alongside unresolved payroll remittances and gaps in access to core accounting systems. Overall, September collections implied by aged A/R appeared materially unaccounted for relative to deposits observed in RBC and newly opened accounts.

With refinancing efforts remaining indicative only (non-binding term sheets) and no credible plan to protect collateral during a lengthy adjournment, the Court concluded neutral, independent stewardship was “just and convenient.”

msi Spergel Inc. is the receiver. Counsel is Aird & Berlis for RBC, Gowling WLG (Canada) LLP for the receiver, Kramer Simaan Dhillon LLP for the debtors and Harrison Pensa LLP for Stride Capital.