The National Company Law Appellate Tribunal (NCLAT) has dismissed the plea of Jindal Stainless Ltd, one of the bidders for debt-ridden Mittal Corp, challenging the issuance of a fresh Request for Resolution Plan (RFRP) by the lenders. A two-member NCLAT bench observed that the lenders of Mittal Corp were empowered to issue a fresh RFRP when none of the resolution plans had been approved by the committee of creditors (CoC).
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The lenders have already approved the bids of rival Shyam Sel and Power Ltd (SSPL), and an application has already been moved by the Resolution Professional (RP) before the Mumbai bench of the National Company Law Tribunal (NCLT) seeking its approval. The tribunal further added that its previous order of January 18, 2023, directing the RP of Mittal Corp to initiate a fresh voting process on the resolution plans received has been complied.
NCLAT said issues raised by Jindal Stainless subsequent to February 10, 2023, when RFRP was issued, need no consideration. The appellate tribunal said that it is open for Jindal Stainless to file an objection over the application filed by the RP before NCLT for the approval of the SSPL bid. NCLAT observed that all resolution plans, including those of Jindal Stainless and SSPL, were put before the CoC in its meeting dated January 25, 2023, and the voting result was declared on February 10, 2023.
The CoC, under the CIRP Regulations, was empowered to issue a fresh RFRP when none of the resolution plans was approved. On January 18, 2023, NCLAT, over a plea by Jindal Stainless, had set aside an NCLT order, which had permitted rival SSPL to submit a revised bid, even after the voting of the CoC had commenced on August 7, 2022. It had directed the RP to initiate a fresh voting process over the bids and complete the process within one month.
Jindal Stainless submitted that the CoC ought not to have proceeded to approve any resolution plan submitted in response to RFRP dated February 10, 2023. However, NCLAT observed that after the issue of fresh RFRP on February 10, 2023, although other resolution applicants submitted their resolution plans, Jindal Stainless did not submit a plan and instead filed a plea against it before the NCLT. Therefore, NCLAT dismissed the plea of Jindal Stainless and directed them to approach NCLT.
