New Delhi: The Supreme Court on Monday upheld an order of the National Company Law Appellate Tribunal (NCLAT) approving UltraTech Cement Ltd’s revised ₹7,900 crore bid to acquire debt-laden Binani Cement Ltd. A two-judge bench headed by Justice Rohinton F. Nariman was hearing an appeal by the Dalmia Bharat Pvt. Ltd-owned Rajputana Properties.
SC upholds NCLAT order approving Ultra Tech’s revised bid
Solicitor General Tushar Mehta, appearing for the committee of creditors (CoC), told the court that UltraTech’s bid was backed by 100% of secured creditors, 100% of unsecured creditors and 100% of the operational creditors.
Opposing the revision of UltraTech’s bid, senior advocate Gopal Subramanium, on behalf of Rajputana Properties, said this was against the spirit of the insolvency law and that bids could not be revised after being aware of the competitor’s bid.
On 14 November, a two-member bench of the NCLAT had dismissed an appeal by Rajputana Properties, saying its offer for Binani Cement was “discriminatory” against some financial creditors.
“The objective of the Insolvency and Bankruptcy Code is resolution (and) the purpose of the resolution is for maximization of the value of assets of the corporate debtor,” the tribunal ruled.
At the root of the dispute is a decision by Binani Cement’s committee of creditors to consider an improved bid from UltraTech after Rajputana Properties’ ₹6,930 crore bid was declared the highest and filed with the Kolkata bench of the bankruptcy court for its approval.
Rajputana Properties had in July approached the Supreme Court challenging the committee of creditors’ decision to consider UltraTech’s revised proposal, which would entirely pay off all secured and unsecured financial creditors, as well as operational creditors.
The apex court referred the matter to the NCLAT.
In its order, the NCLAT had said the resolution process in the IBC should consider the interests of even those creditors that are not part of the resolution process, such as operational creditors, while maintaining the ability of the target company in continuing as a going concern.