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Dewan Housing Finance Ltd’s erstwhile promoter Kapil Wadhawan has moved the Supreme Court, challenging the stay order passed by the National Company Law Appellate Tribunal (NCLAT) on his offer to lenders, according to two people aware of the matter.

The NCLAT last week stayed the ruling of the National Company Law Tribunal (NCLT), which had directed lenders of Dewan Housing Finance Corporation Ltd (DHFL) to consider Wadhawan’s settlement offer of 91,000 crore.

“Wadhawan appealed in the Supreme Court on Monday evening. Date for hearing the case is not known yet," said one of the persons cited above.

Last week, the committee of creditors (CoC) led by Union Bank, and the Reserve Bank of India-appointed administrator filed separate applications challenging the Mumbai bench of the NCLT that asked them to evaluate the offer by Wadhawan in the next 10 days.

The NCLAT in its interim order said, “As such we are unable to appreciate the hurry imposed on the Administrator and CoC to consider the Second Settlement Proposal. The Learned Counsel for the Appellant are raising various legal issues as to how the settlement proposal has been styled as a precursor or pre-stage process of application under Section 12A of IBC. Regulation 30A of 7 Company Appeal (AT) (Ins.) No. 370 of 2021 CIRP Regulations requires reasons to be given for application under Section 12A of IBC if filed after issue of Expression of Interest. Here the matter had proceeded to the stage where even Resolution Plan had been approved and was before Adjudicating Authority. There would be no end if such reversals are allowed."

The appellate tribunal also stayed the NCLT order that directed lenders to consider the settlement offer within 10 days. It observed that the appeal should not be an impediment for the NCLT to decide on the proposed resolution plan of Piramal Group to acquire DHFL, which was approved in January.

In its appeal against the NCLT order, the administrator said that Wadhawan’s offer was vague and did not mention if it should be treated as a resolution plan under the insolvency code or as a settlement proposal under Section 12A of the code to withdraw from NCLT. Separately the offer is also ineligible to be considered as a resolution plan under Section 29 A as Wadhawan’s account has been declared as “fraud" by the lenders.

“The Impugned Order has the effect of creating a disruption from the strict discipline of the timelines set out under the CIRP and has the effect of compelling the CoC to vote on a settlement proposal offered by Respondent 1, which the CoC in its commercial wisdom had chosen not to," the administrator’s appeal said.

The CoC also said that the NCLT order has been passed without considering any of the submissions in law made by the CoC, administrator and the RBI.

“It is also the case of the CoC that the conduct of Mr. Kapil Wadhawan is malafide and his offers are nothing but the same content in different formats made with the view to derail the corporate insolvency resolution process," the CoC’s appeal said.

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