The Supreme Court on Tuesday passed an order that prevents the National Company Law Tribunal (NCLT) against taking any final decision on bids for the debt-stricken Bhushan Power & Steel (BPSL).
BPSL promoter Sanjay Singal had filed a petition against “a lacuna in valuation of the company,” a member of his legal team him told ET. Mahesh Agarwal, who represented Singal, said against a fair value of Rs 25,000 crore that has been fixed for BPSL, bids have come in below this threshold. NCLT has received bids from Tata Steel and UK-based Liberty House for Rs 17,000 crore and Rs 18,500 crore, respectively.
Both potential buyers have also offered to invest an additional Rs 7,000 crore in the operations of the company. BPSL was referred to the NCLT last year after it had piled up debt worth Rs 47,000 crore.
After Tuesday’s hearing, the Supreme Court passed an order saying “the bids will not be finalised by the National Company Law Tribunal without leave of this court.” A battery of top advocates, including, Mukul Rohatgi, K V Vishwanathan, Mahesh Agarwal, Rishi Agrawala, Arvind Kumar Gupta, Karan Luthra, Himanshu Satija, Vishnu Tallapragada and E C Agarwala, represented Singal.
In a related development, the National Company Law Appellate Tribunal (NCLAT) on Tuesday stayed a lenders’ meeting to vote on a resolution plan submitted for BPSL by Tata Steel after operational creditors of BPSL approached the appellate tribunal. Operational creditors alleged that they have not been allowed to represent their case at the Committee of Creditors (CoC) meeting. The lenders, who are a part of the company’s CoC, were to meet on Tuesday.
There are about 1,700 operational creditors of BPSL who are seeking their dues. The NCLAT has called for a hearing on July 20. It has also asked Liberty House to present eligibility related compliance under Clause 29A of the Insolvency and Bankrupcty Code.
Earlier, lenders had rejected the resolution plan for BPSL submitted by Liberty House after the bid deadline was over. Tata Steel and JSW Steel were among the bidders who had already submitted resolution plans for BPSL with offers of Rs 17,000 crore and Rs 13,000 crore, respectively.