INSUBCONTINENT EXCLUSIVE:
MUMBAI: The committee of creditors in the Essar Steel bankruptcy case has sought the dismissal of two applications that could potentially
delay debt resolution at the stressed steelmaker, for which ArcelorMittal has been chosen the winner by the lenders.
The interlocutory
application, moved before NCLT Ahmedabad in this case, is generally used to seek urgent relief, or to bring fresh facts to the court’s
knowledge.
The committee has also sought day-to-day hearing of other such applications, filed by operational creditors
A group of 30 vendors, who had supplied goods and services to Essar, came together to petition the NCLT’s Ahmedabad chapter asking for
their dues worth more than Rs 600 crore
These dues are not promised to be repaid in the ArcelorMittal plan.
“….The application filed by the resolution professional of GPI
Textiles is not maintainable,” the committee of creditors said in its submission before NCLT, citing a Supreme Court judgement
The committee is represented by law firm Shardul Amarchand Mangaldas.
ArcelorMittal’s expected acquisition of Essar Steel could face a
further challenge over unpaid dues at GPI Textiles, a company promoted by LN Mittal’s brothers Pramod and Vinod Mittal, ET had reported on
November 2.
The Insolvency and Bankruptcy Code (IBC) stipulates that promoters of defaulting companies and people “connected” to them
are barred from participating in bids for stressed assets.
“The contention that Arcelor is obliged to clear the amounts overdue from GPI
Textiles is contrary to the… SC Judgement…and, therefore, ought to be rejected…,” CoC said in the application
ET has reviewed the detailed application filed by the lenders.
Jalesh Grover is the resolution professional of GPI Textiles, and is
represented by Nipun Singhvi, an Ahmedabad-based lawyer.
Essar Steel promoters also filed a caveat earlier this week, which works as a legal
caution as well as buys the petitioner the right to be heard before a final order is given.
“It is submitted that the purported settlement
proposal is nothing but another subterfuge being adopted by the promoters of the corporate debtor to derail the resolution process,” said
the CoC application.
The 15-month-long battle for Essar Steel had seemed to reach a conclusion when the lenders almost unanimously voted in
favour of ArcelorMittal's resolution plan on October 25
The plan promised Rs 42,000 crore to creditors on outstanding debt of Rs 49,000 crore as well as an additional Rs 8,000 crore infusion in
the company, taking the total offer to Rs 50,000 crore.
However, hours later, the Essar Steel promoters made a Rs 54,000-crore counter offer
that seeks to pay back all creditors in full.
“It is expedient that all the concerned parties are issued direction to complete pleadings
in an expeditious and time-bound manner so that the Plan Application and other related aspects/objections with respect to maintainable
applications are heard expeditiously on a day to day basis,” the application said.
The GPI Textiles and Essar Steel approval plans will be
heard on November 28 by the NCLT.
