The National Company Law Appellate Tribunal (NCLAT) has dismissed the plea filed against the ongoing insolvency of Tayo Rolls Ltd, a subsidiary of Tata Steel, filed by some of its employees. A two member bench headed by Chairman Justice S J Mukhopadhaya said “no interference is called for against the order of admission” of insolvency proceedings of the company. Earlier, the Kolkata bench of the National Company Law Tribunal (NCLT) had on April 5, 2019, had admitted the initiation of Corporate Insolvency Resolution Process (CIRP) under Section 9 of the Insolvency and Bankruptcy Code, 2016 (IBC) with regards to Tayo Rolls.
The plea was filed by Suresh Narayan Singh who is the authorised representative of 284 workers of Tayo Rolls. However, Singh later challenged the order of NCLT before NCLAT contending that NCLT order was unwarranted and not tenable under law. Rejecting the plea, NCLAT said: “such submissions cannot be accepted, nor such ground can be noticed to admit or reject the application under Section 9”.
Section 9, of IBC gives power to the operational creditors of a company for initiation of corporate insolvency resolution process after default. “In fact, the present appeal is not maintainable under Section 61, as appellant Suresh Narayan Singh is not an aggrieved person, the application under Section 9 preferred by him having been admitted,” NCLAT observed. It further said: “the appeal is dismissed.
Though, we are of the opinion that this is a frivolous appeal for which cost should be imposed, but in view of the fact that Suresh Narayan Singh is representing 284 workers, we are not imposing any cost.” Tayo Rolls, is a subsidiary of Tata Steel since December, 2008. It was promoted in collaboration with Japan based Yodogawa Steel Works and Nissho Iwai Corporation for production of cast iron and cast steel rolls for metallurgical industries.
Source: Financial Express, July 20,2019