New Delhi: Further delaying the already- delayed resolution process for the Essar Steel, Essar Group director Prashant Ruia has moved a fresh application before NCLT here seeking to set aside the ArcelorMittal bid to take over the crippled company citing a Supreme Court judgement.
The new petition before the National Company Law Tribunal (NCLT) here was moved on February 1 by former managing director of Essar Steel Dilip Oommen along with its project director Rajiv Kumar Bhatnagar, as well as Ruia.
This fresh move by the Essar Steel directors came after the NCLT-Ahmedabad had on January 29 rejected the debt settlement proposal put forth by the Essar Steel Asia Holdings despite it being much higher at ₹54,389 crore than the former's ₹42,000-crore bid, citing the January 31 Supreme Court judgement in the Ruchi Soya case.
The petition says though Oommen and Bhatnagar were removed after the insolvency process began, they still "continue to be part of the day-to-day management of Essar Steel and hold the designations of managing director and director (projects), respectively."
The NCLT bench comprising Manorama Kumari and Harihar Prakash Chaturvedi said it will decide Tuesday whether the petition will be admitted or not.
The Supreme Court had order on January 31 in the Ruchi Soya case said that the suspended board of directors were required to be included in the all deliberations by the committee of creditors, including the discussions of resolution plans which are to be voted upon.
The apex court order, citied in the application, further said resolution plans submitted by applicants should also be shared with the suspended board of the directors.
While claiming that such a process, as prescribed by the SC on January 31, was not followed in the Essar Steel case, the directors sought to "quash and set aside" the lenders' decision to accept ArcelorMittal's lower bid to take over Essar Steel.
The applicants also urged the tribunal to direct the resolution professional of Essar Steel to "convene a meeting of the committee of creditors, wherein the resolution plans submitted by the potential resolution applicants be deliberated and discussed afresh and thereafter voted upon".
In addition, the applicants urged the NCLT "to direct the RP to provide the applicants with copies of all the resolution plans submitted for by potential resolution applicants for the resolution of the case". The case of Essar Steel, which runs a 10-million-tonne steel mill in Gujarat, has been going on much beyond the mandated 270 days.
The case began on February 12, 2018 when ArcelorMittal and Numetal (originally promoted by Ravi Ruia's son Revant with a 25 percent stake) submitted the bids to take over the company.
On March 21, NCLT has found that both the bids were ineligible under Section 29 of IBC. While ArcelorMital's bid was rejected on technical grounds, Numetal's was declared invalid for its association with the Ruias. The tribunal also ordered the RP to fresh bids which was challenged on some technical grounds again.
On April 2, the second round of bids were submitted, and NCLT asked the RP not to open the bids till applications were disposed off; and on April 19, it remanded the first bids to RP and the lenders and declared the second bids invalid.
On September 7, NCLT said Numetal's second bid was also invalid and asked ArcelorMittal to clear the NPAs by way of its past ownership in Uttam Glava Steel and RS Petron by September 11 which was challenged in the apex court.
The Supreme Court on October 4 allowed the bids by both the companies with the condition that they paid their entire dues to creditors. Following this, on October 25, the Ruias made a settlement offer of ₹54,389 crore through Essar Steel Asia Holdings.
On January 29, the NCLT Ahmedabad rejected Ruia's higher bid after the both RP and the committee of creditors rejected the Ruias' bid citing the mid-January 2019 Supreme Court order that upheld the IBC law in its totality.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.