The Supreme Court on Monday directed the National Company Law Appellate Tribunal (NCLAT) to hear Vedanta’s challenge to the Jaiprakash Associates Ltd. (JAL) resolution on priority on April 10, while declining to stay the implementation of Adani Enterprises’ resolution plan.

The court allowed the implementation of the resolution plan to continue and clarified that it will remain subject to the outcome of the NCLAT proceedings.

A bench comprising Chief Justice Surya Kant and Justice Joymalya Bagchi declined to interfere with the appellate tribunal’s earlier order permitting the implementation of the plan, noting that the NCLAT is already processing the matter with a hearing scheduled shortly.

At the same time, it introduced a safeguard by directing that any major policy decision by the JAL monitoring committee would require prior approval from the appellate tribunal. During the hearing, Vedanta argued that allowing the plan to be implemented could lead to irreversible consequences, including disbursement of funds to creditors and changes in the company’s structure, potentially rendering its appeal ineffective.

It maintained that its bid offered higher value and questioned the transparency of the process. On the other hand, the Committee of Creditors (CoC) defended the process, stating that the difference between the competing bids was limited and that the resolution had been conducted in line with the prescribed framework. It also argued that implementation would take time and that adequate safeguards were already in place, with the process being subject to the outcome of Vedanta’s appeal.

Tracing the dispute’s origin

The dispute stems from insolvency proceedings at Jaiprakash Associates Ltd, which was admitted for resolution in June 2024 following claims exceeding Rs 57,000 crore. The process saw strong interest, with multiple bidders participating, before Adani Enterprises and Vedanta emerged as the leading contenders.

Lenders eventually approved Adani Enterprises’ resolution plan with a 93.81% voting share, citing stronger execution certainty and upfront recovery. The National Company Law Tribunal (NCLT) cleared the plan in March this year.

Vedanta has challenged both the validity of the resolution plan and its approval, arguing that its own bid of Rs 16,726 crore was higher and better aligned with value maximisation under the Insolvency and Bankruptcy Code. It has also contended that it was initially declared the highest bidder during the process, but the final outcome was altered, and that its revised offer was not considered.

Lenders, however, have maintained that the evaluation was based on multiple parameters and that Vedanta’s revised bid was submitted after the close of the process, making it ineligible for consideration under the rules.

Adani Enterprises was represented by senior advocates Mukul Rohatgi and Ritin Rai, along with a team from Karanjawala & Co. The resolution professional was represented by senior advocates Abhishek Manu Singhvi and Arun Kathpalia, along with a team from Shardul Amarchand Mangaldas while Vedanta was represented by senior advocates Kapil Sibal, V V Giri and Abhijeet Sinha, along with advocate Deep Roy. The CoC was represented by senior advocate Niranjan Reddy along with advocate Biswajeet Dubey.