KSK Mahanadi Insolvency: Supreme Court Revives Resolution Process, Strikes Down Telangana HC's Deferral
The top court says the high court erred in deferring the resolution process.
(Source: Supreme Court of India website)
The Supreme Court set aside on Monday an order of the Telangana High Court that deferred the resolution process of the insolvent KSK Mahanadi Power Co. As a result of the top court's order, the insolvency resolution process of the insolvent company has been revived.
The case was filed by the committee of creditors of KSK Mahanadi in the interest of timely completion of the debt-ridden power company’s resolution process.
It is crucial to note that Adani Power Ltd. is presently the highest bidder for the company, with a bid to the tune of Rs 27,000 crore.
While setting aside the order, the top court said the high court was wrong in deferring the resolution process, and it passed its order without issuing a notice to the parties involved.
In September, the Uttar Pradesh Power Corp. urged the high court to pass an order that would, in effect, consolidate the resolution processes of the KSK Mahanadi Pvt. and two of its subsidiaries—KSK Water Infrastructures Pvt. and Raigarh Champa Rail Infrastructure Pvt.
UPPCL demanded the consolidation to ensure a "fair, transparent and efficient resolution process." The high court did not grant the requested consolidation but directed UPPCL to move the National Company Law Tribunal to seek the relief.
In doing so, the high court observed that in the meantime, the NCLT takes a final call on the plea raised by UPPCL, and the resolution process should stand deferred.
