The National Company Law Appellate Tribunal has reserved its judgment on the appeal filed by a bidder in Reliance Capital’s (RCap)bankruptcy case and gave all parties three days to file submissions.
The plea was filed by by Vistra ITCL (India), which challenged an earlier National Company Law Tribunal (NCLT) order that termed the second e-auction of the firm a violation of bankruptcy rules.
The hearings at the National Company Law Appellate Tribunal had started on February 7.
According to RCap’s Committee of Creditors (CoC), value maximisation was the key objective under the Insolvency and Bankruptcy Code (IBC) and it was free to negotiate as many times as needed.
Senior advocates Mukul Rohatgi and Ramji Srinivasan appeared on behalf of Torrent Investments on Tuesday, a group company through which the Gujarat-based Torrent Group had placed its bid for the entire assets of RCap. Torrent Group had earlier moved the NCLT, terming RCap administrator’s decision to hold another round of auction “illegal”.
According to Torrent Group, the IBC permitted only one challenge mechanism and further auctions were illegal.It also stated that its bid of Rs 8,640 crore was the highest, when the first challenge mechanism had ended on December 21.
The final decision in the RCap insolvency case will be crucial as a debate rages on the underlying objective of the Insolvency and Bankruptcy Code–whether the completion of the resolution plan in a time-bound manner or maximisation of value for the lenders is of paramount importance.