Home / Companies / News /  NCLT allows Torrent Investment’s plea challenging second auction for RCap

Mumbai - The National Company Law Tribunal (NCLT) on Thursday allowed Torrent Investment’s plea challenging the lender’s proposal to hold a second auction for sale of bankrupt Reliance Capital. 

It also allowed Torrent’s earlier application restricting Hinduja group from submitting a revised offer for the debt-laden firm. This was after the auction concluded on 21 December.

“The application (by Torrent) is allowed. It is hereby declared that the issuance of the process note for extended challenge mechanism is in violation of section 39(1)(a) of the CIRP (Corporate Insolvency Resolution Process) regulations," the bench comprising justices Shyam Babu Gautam and Pradeep Narhari Deshmukh said.

A detailed order is awaited in the matter.

The lenders are likely to challenge the order in the National Company Law Appellate Tribunal (NCLAT).

Torrent Investments, which emerged as the top bidder in the auction process with an offer of 8,640 crore for Reliance Capital (RCap), had approached the bankruptcy court to restrain lenders from considering Hinduja’s upgraded offer of 9,000 crore, arguing that accepting late offers violated the norms for insolvency resolution process.

On 3 January, the NCLT in its order asked the lenders to not take up the bid offered by the Hinduja group till the next date of hearing, thereby granting interim relief to Torrent

“We do not find any reason to not to further continue the interim directions all the more when the applications can be listed in the shortest possible time for pronouncement of order in the week beginning from 30 January," the bench said.

On Monday, the NCLT granted the administrator an extension of 45 days to complete the process of resolution for Reliance Capital. This was after the administrator in his application sought an extension of 90 days for completing the CIRP.

The deadline to complete the resolution of the insolvent firm ended on 31 January.

Priyanka Gawande
Priyanka Gawande is a senior legal correspondent at Mint. She has worked as legal reporter for four years with both television and digital mediums. Based in Mumbai, she reports on disputes across sectors including banking, corporates and finance. This also includes insolvency and bankruptcy cases and intellectual property rights (IPR) litigation. Her focus also comprises tracking capital markets and disputes relating to securities law. Previously, Priyanka worked with Informist Media for 2.5 years covering major insolvency and bankruptcy cases and corporate developments. She started her career in journalism with Business Television India (BTVi) where she reported on primary markets, banking, finance and insurance companies.
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