The Supreme Court will on Tuesday hear the decision of the National Company Law Appellate Tribunal (NCLAT) on the Videocon Industries Ltd resolution matter. Earlier in August, the apex court had refused to set aside the stay order given by the NCLAT on Vedanta group’s Twin Star Technologies acquisition of Videocon group.
The NCLAT had in July stayed industrialist Anil Agarwal-led Twin Star Technologies' ₹2,962.02 crore-takeover bid for debt-ridden Videocon Industries over the pleas filed by two dissenting creditors, reports news agency PTI.
Prior to it, a two-member NCLAT bench headed by its Officiating Chairperson Justice A I S Cheema had stayed the order passed by the NCLAT in June and directed to maintain "status quo ante" as before passing of the order, till the next date of hearing.
The NCLAT order came over the petition filed by two creditors--Bank of Maharashtra and IFCI Ltd--contending that as per the law, they could not have been paid less than the liquidation value. The NCLAT had in its June order observed that the liquidation value of the 13 Videocon group companies and resolution plan value were very close.
In its appeal before the top court, Twin Star Technologies said that while staying the implementation of its resolution plan, the NCLAT “has blatantly ignored the settled law laid down by the SC in catena of decisions that the commercial wisdom of Committee of Creditors (CoC) in accepting or rejecting the resolution plan (RP) is paramount and that there should be no interference to an approved RP, unless the same contravenes Section 30(2) of the IBC… As apparent, its RP does not contravene any provisions of the Code or its regulations”.
{{/usCountry}}In its appeal before the top court, Twin Star Technologies said that while staying the implementation of its resolution plan, the NCLAT “has blatantly ignored the settled law laid down by the SC in catena of decisions that the commercial wisdom of Committee of Creditors (CoC) in accepting or rejecting the resolution plan (RP) is paramount and that there should be no interference to an approved RP, unless the same contravenes Section 30(2) of the IBC… As apparent, its RP does not contravene any provisions of the Code or its regulations”.
{{/usCountry}}It also said that the order does not assign any reasons on prima facie case, irreparable loss and balance of convenience while staying the approval order. It stated that the reliance was based solely on a ‘doubt’ of the NCLAT of non-compliance of confidentiality clause in respect of liquidation value and fair market value as categorised by NCLAT in its order.