Torrent Power challenges NCLT nod to Sarda Energy’s resolution plan for SKS Power

Torrent Power has moved the National Company Law Appellate Tribunal (NCLAT) to challenge the NCLT order approving Sarda Energy and Mining's (SEML) resolution plan for the debt-ridden SKS Power Generation.

Last week, the Mumbai bench of the National Company Law Tribunal (NCLT) approved Sarda Energy and Mining's bid and rejected applications, including that of Torrent Power, to acquire SKS Power Generation (Chhattisgarh). Torrent Power had raised objections over the selection process, describing it as discriminatory and contended that it had proposed the highest upfront payment. The Torrent group firm also sought a copy of the approved plan, which was rejected by the NCLT.

Torrent Power’s petition is scheduled for hearing on Tuesday, August 20, before a three-member bench of the NCLAT headed by its Chairperson Justice Ashok Bhushan.

SKS Power Generation’s corporate insolvency resolution process (CIRP) started in April 2022 following a plea by Bank of Baroda, which had a total admitted claims of ₹2,560 crore on the company.

Besides Torrent Power, several other companies, such as NTPC, Jindal Power and Singapore-based Vantage Point Asset Management were also in the race.

However, the Committee of Creditors (CoC) voted in favour of Sarda Energy’s resolution plan for SKS Power Generation.

According to media reports, SEML's bid of over ₹2,000 crore covers nearly all dues owed to the financial creditors.

Ahmedabad-based Torrent Power had contended before the NCLT that it had submitted the highest upfront cash payment to the creditors of SKS Power Generation after incorporating the observations of the RP and lenders.

The Torrent group firm argued that owing to its highest proposed upfront payment, it ought to have been declared as the successful bidder and not “the Respondent No 2 (SEML) which, per its contentions, had lower qualitative and quantitative credentials”. Torrent Power also alleged it to be "discriminatory" as it was done without providing similar opportunities to other resolution applicants.

Torrent Power also alleged it to be “discriminatory” as it was done without providing similar opportunities to other resolution applicants.