The National Company Law Appellate Tribunal (NCLAT) on Friday dismissed Edelweiss Asset Reconstruction Company’s multiple pleas challenging the August 2, 2017 order of the National Company Law Tribunal (NCLT) that approved Synergy Dooray Automotive’s (SDAL) resolution plan.
Lenders to the debt-ridden firm had on June 24, 2017 approved Synergies Dooray’s resolution plan, with 91.06% majority, submitted by a related party Synergies Castings (SCL) that provided for merger of SCL with SDAL.
The ARC also alleged that SCL’s resolution plan, submitted at the Hyderabad bench of the NCLT, was contrary to the law and the agreement SCL had signed on November 24, 2016 with Millennium Finance (MFL) to assign a major part of the debt holding was invalid and was entered into with the malafide ulterior motive of reducing its voting rights. “In absence of any merit, we dismiss these appeals,” the two-member NCLAT bench, headed by its chairperson Justice SJ Mukhpadhaya, said in the order.
Rejecting Edelweiss’s objections to the merger proposal in the resolution plan, the bench observed, “The arguments of the appellant (Edelweiss) that merger and amalgamation of the companies cannot be proposed in the resolution plan or such proposal is violative of clause (e) of sub-section (2) of Section (30) is fit to be rejected”.