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Country's largest lender SBI has initiated insolvency proceedings in the National Company Law Tribunal (NCLT) against Bajaj Hindusthan Sugar, the company said in a regulatory filing on Tuesday.

The petition has been filed at the Allahabad bench of the NCLT under the Insolvency and Bankruptcy Code, the filing showed.

“We understand that State Bank of India, financial creditor through its advocate has initiated Corporate Insolvency Resolution Process of Bajaj Hindusthan Sugar Limited before the Hon'ble National Company Law Tribunal, Allahabad Bench under Section 7 of Insolvency and Bankruptcy Code 2016. This disclosure is made pursuant to Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015," the company statement read.

Bajaj Hindusthan Sugar owns 14 factories with the total capacity of crushing 136,000 tonnes of sugarcane per day.

According to reports, Bajaj Hindusthan Sugar owes around 4,800 crore to banks such as the SBI, Punjab National Bank, Indian Bank and Central Bank of India.

Creditors typically file insolvency petitions in the company court for non-payment of dues. Once the court admits the petition, insolvency proceedings against the firm starts.

Last month, capital markets regulator Sebi had imposed a penalty of 10 lakh on Bajaj Hindusthan Sugar for not disclosing closure orders with respect to its certain distilleries and imposition of penalty by Central Pollution Control Board.

The company has been directed to pay the fine within 45 days, the Securities and Exchange Board of India (Sebi) order read.

The order came after the regulator received a complaint through SCORES against Bajaj Hindusthan Sugar, whereby the complainant raised concerns regarding false reporting/misreporting in the annual report in respect of Show Cause Notices (SCNs) issued by Pollution Control Board.

After this, Sebi conducted a probe and found that the firm did not disclose about closure orders with respect to the three distilleries – Palia, Gola and Kinauni. Further, imposition of penalty of 1.96 crore on certain distilleries was also not disclosed during FY20.

It had also said that the closure orders had a substantial impact on the sales, production, revenue and profit for FY 2018-19 to FY 2019-20.

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