The National Company Law Appellate Tribunal (NCLAT) on Thursday admitted the appeal moved by Renaissance Steel India Pvt. Ltd, one of the unsuccessful bidders for Electrosteel Steel India Pvt. Ltd, against a 17 April order of the National Company Law Tribunal’s (NCLT) Kolkata bench approving Vedanta Ltd’s Rs5,320 crore resolution plan for the debt-ridden Electrosteel.
Renaissance Steel contended that Vendanta was ineligible to bid under Section 29A of the Insolvency and Bankruptcy Code (IBC) as one of Vedanta’s affiliates in Zambia—a unit of its UK-based parent Vedanta Resources Plc—had been found guilty of violating certain environmental laws punishable with two or more years in jail. Renaissance Steel also raised an objection against committee of creditors’ decision to not allow it to participate in the meeting in which the successful bidder was decided.
Before NCLT, a similar objection was raised by Renaissance Steel against another bidder, Tata Steel, claiming one of its UK subsidiaries had flouted the UK Health and Safety at Work Act, and fines were imposed on it.
State Bank of India’s insolvency plea against Electrosteel, which is one of the 12 initial accounts identified by the Reserve Bank of India for resolution, was admitted by the Kolkata Bench of NCLT in July 2017. NCLT’s 17 April order made Electrosteel the first of the 12 to exit a corporate insolvency resolution process.
The matter would be heard on 28 May.
Source: Livemint, May 17, 2018