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Prashant Ruia, one of the promoters of stressed Essar Steel, and UK-headquartered Standard Chartered Bank plan to file a fresh appeal in the National Company Law Appellate Tribunal (NCLAT) challenging the entire process of debt resolution of the company favouring ArcelorMittal.
The petition challenging the process was mentioned before a two-member bench headed by Chairman Justice SJ Mukhopadhaya on Monday, but the judge directed the petitioners to file the appeal with the copy of the latest NCLT order, which is expected to be available early Tuesday morning.
StanChart Bank seems to be aggrieved even after NCLT directed committee of creditors (CoC) to consider SCB as financial creditor rather than an operational creditor.
Last Friday, the Ahmedabad bench of NCLT cleared the ₹ 42,000-crore resolution plan submitted by ArcelorMittal. However, NCLT directed the CoC to consider sharing 15 per cent of amount recovered with the operational creditors.
As per the original resolution plan cleared by CoC, the operational creditors with over ₹ 1 crore exposure had to forego the entire amount.
Quoting a Supreme Court order, Prashan Ruia, in an earlier petition to NCLT, had said that CoC have to involve the suspended board members of Essar Steel in finalising the highest bidder. The petitioner had demanded NCLT to cancel the ArcelorMittal bid as it was selected by the CoC without involvement the suspended Essar Steel board.
Last November, StanChart Bank had said as per the Core-Committee Members’ recommendation, SCB would receive ₹61 crore or just 1.47 per cent of its admitted claim of ₹ 3,487 crore. While SBI and other financial lenders would receive 100 per cent of the principal amount and 40 per cent of the interest.
SCB claimed that it is aggrieved by the discriminatory practice of the CoC, which has illegally formed a Core-Committee of CoC (beyond the scope of IBC) to negotiate with ArcelorMittal India.
The delay in resolution plan of Essar Steel had cost ₹ 9,900 crore in interest for the financial creditors, which had claimed that they are losing out ₹ 17 crore a day. The case is going on for last 590 days against the Insolvency and Bankruptcy Code’s outer limit of 270 days for the debt resolution.
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