Essar Steel's former promoter Prashant Ruia and two other directors of the erstwhile board of the steel maker approached the National Company Law Appellate Tribunal against a lower bankruptcy court’s order that allowed takeover of the company by ArcelorMittal.
Ruia has challenged the orders of the Ahmedabad bench of the National Company Law Tribunal which on Friday approved the Rs 42,000-crore takeover plan of Essar Steel by ArcelorMittal.
The matter was mentioned before a two-member bench headed by Chairman Justice SJ Mukhopadhaya, which asked it to be listed after the Ahmedabad bench of the National Company Law Tribunal posts its full written order.
Standard Chartered Bank, a dissenting bank among the Committee of Creditors of Essar Steel, also challenged the March 8 order of the Ahmadabad bench of NCLT. The bank is opposing the resolution plan approved by the CoC of Essar Steel contending that it was favoured towards the secured creditors.
The two other directors of Essar Steel are—Dilip Oommen and Rajiv Bhatnagar. On Friday, the Ahmedabad bench of the NCLT had approved the lenders’ plan to let global steel giant ArcelorMittal take over the debt-ridden Essar Steel.
Passing an order, the tribunal had suggested that the payment of Rs 42,000 crore by ArcelorMittal be distributed among financial and operational creditors in the ratio of 85:15. The detailed written order of the Ahmedabad bench is still awaited.
Essar promoters are pushing for a one-time settlement proposal of Rs 54,389 crore with the lenders and withdrawal of the IBC proceedings against the company. "We are also confident of the legal validity of our said offer made under Section 12A, which provides for the withdrawal from the IBC process by making full payment to the creditors," the company had said earlier.
Essar Steel owns a 10-million-tonne steel mill at Hazira in Gujarat.
A two-member NCLT bench comprising HP Chaturvedi and Manorama Kumari passed order after NCLAT had on Feb. 28 set a deadline to take a decision on ArcelorMittal's proposal by March 8 and failing to which it would call the records and may pass an order accordingly.
The resolution plan for Essar Steel has been tied up in legal wrangles for almost two years and has crossed the mandated 270 days period under IBC, as promoters challenged nearly every procedure engaging all available legal forums.
Essar Steel was among the first 12 cases selected by the Reserve Bank of India to be resolved under the Insolvency and Bankruptcy Code.
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