UK court suspends discharge of Pramod Mittal’s bankruptcy

Pramod Mittal, brother of steel tycoon Lakshmi Mittal, has had the discharge of his bankruptcy suspended by the high court in London. Mittal was adjudged bankrupt in 2020 on a petition by Moorgate Industries after he failed to pay £140m. The trustee appointed to oversee the bankruptcy alleged that Mittal failed to cooperate in sharing crucial information and was evasive about his assets and liabilities. The ruling means Mittal will remain on the bankruptcy register and be debarred from becoming a director or involved in company management.

London: Three years after he was declared bankrupt on June 19, 2020, on Monday the high court in London suspended the discharge of Pramod Mittal’s bankruptcy. In the UK, a person declared bankrupt gets automatically discharged a year after unless there have been serious non-compliance or non-cooperation by the bankrupt person.

Mittal was adjudged bankrupt on a petition by Moorgate Industries after he had failed to pay £140 million. The trustee appointed to oversee the bankruptcy had alleged that Mittal had failed to co-operate in sharing crucial information and was evasive to pointed questions about his assets and liabilities. (HT PHOTO)

Pramod Mittal stood guarantee for the loan to Global Ispat Koksna Industrija, which he co-owned.

The ruling by Justice Trower means that Pramod Mittal, younger brother of steel tycoon Lakshmi Mittal, would remain on the bankruptcy register and continue to be debarred from becoming a director or involved in the management of a company.

Mittal was adjudged bankrupt on a petition by Moorgate Industries after he had failed to pay £140 million. The trustee appointed to oversee the bankruptcy had alleged that Mittal had failed to co-operate in sharing crucial information and was evasive to pointed questions about his assets and liabilities.

On June 10, 2021, just days before the one-year deadline, the trustee filed an urgent application to suspend his automatic discharge. After a rather long, acrimonious and complicated legal wrangling, in April 2022, deputy Insolvency and Companies court judge, Racquel Agnello, turned down the trustee’s application on the grounds that there had been a technical breach of rules.

Mittal’s non-cooperation was so extensive and serious that Judge Agnello noted, “there was a compelling case on the merits for the suspension of the bankruptcy,” which was not even contested by Mittal. Instead, Mittal’s lawyer chose to oppose the application on a technical ground that the trustee had “failed to effect valid service of the suspension application.”

It was against this judgment by Judge Agnello that the trustee filed an appeal. Following a two-day hearing in February 2023, where Mittal was represented by Adam Chichester-Clark and the trustee by Tony Beswetherick and Rowena Page, Justice Trower has now given his judgment, which has put an embattled Mittal on a sticky wicket.

Chichester-Clark told the court that the trustee had left the application until the last minute and hence it would be unfair to grant a suspension of the discharge of the bankruptcy. Beswhetherick, who also appeared in the Vijay Mallya bankruptcy case, told the court that it must take into consideration the serious non-compliance by Mittal and the procedural delay was fully justified which meant that even a late service (as alleged by Mittal) could not justify the discharge of bankruptcy.

Justice Trower’s judgment comes just days after the high court declined Mittal the permission to appeal against the revocation of his individual voluntary arrangement (IVA). The IVA is an agreement between a debtor (Mittal) and his creditors, which spells out the procedure and plan to pay the debt. Mittal’s IVA proposed payment of just £250,000 to Moorgate against their outstanding debt of £140 million.

In November 2022, a court had revoked the IVA following which Mittal filed an appeal. Mittal’s appeal was refused earlier this month. Now, he will be subject to an intense investigation of his assets and liabilities.

During the court proceedings Mittal had claimed that he has assets only worth £150,000 and is supported by his family members.