By Mitali Salian The National Company Law Tribunal (NCLT) has advised Essar Steel\u2019s committee of creditors (CoC) and resolution professional (RP) to consider a judicious distribution of Rs 42,000 crore among financial creditors (FC) and other stakeholders as part of its ruling on the various petitions related to Essar Steel, including approval of the proposed resolution plan by ArcelorMittal. Members of the CoC have already had a meeting on the subject and are likely to take a final decision by Friday on whether they will act on the tribunal\u2019s proposal, a banker aware of the developments told FE. The written order published Thursday read, \u201c.we feel appropriate to observe by making suitable suggestions to the CoC that the method for apportionment of the amount receivable from the Resolution Applicant to be relooked into and reconsidered and, if a reasonable formula for equitable distribution or apportionment of the amount is adopted, then basic requirements of almost all of the creditors, which include secured financial creditors, unsecured financial creditors, operational creditors and other stakeholders, can also be taken care of.\u201d The two-member bench proposed and advised that of the Rs 42,000 crore to be received from ArcelorMittal as upfront payment to financial creditors, the CoC could allot 85% for distribution on a pro rata basis among all financial creditors, which could address Standard Chartered\u2019s concerns. As part of its petition, StanChart proposed that distribution among all secured financial creditors at a rate of 85.6% of their admitted secured claims from Rs 42,000 crore would mean equitable distribution of the amount among all financial creditors including itself. When stakeholders were initially invited to submit claims, Standard Chartered had lodged its claim as a financial creditor for Rs 3,487.09 crore and was later classified a secured financial creditor where it was due a sum of Rs 2,646.05 crore as principal outstanding by the corporate debtor. However, Standard Chartered\u2019s petition reads, it was later alleged the dues were not being paid as per proof of admitted claim on a pro-rata basis and instead proposed to be paid on a different formula adopted by the CoC. As per the new formula, the amount due to a creditor was based on the value of the security possesses by the applicant and in terns of the liquidation value of the assets of the company, which in StanChart\u2019s case meant it would receive only 1.7% of its admitted claim amount or Rs 60.71 crore, while other financial creditors would get 92% of their entire principle debt. Meanwhile, the tribunal dismissed Standard Chartered\u2019s prayer for rejection of the ArcelorMittal resolution plan then awaiting approval from the tribunal as \u2018not legally sustainable\u2019. The NCLT further suggested that another 15%, amounting to Rs 6,300 crore be distributed among other operational creditors (OC) and other stakeholders, who are going to receive nil amount, i.e. those OCs having a debt value of `1 crore and above on the basis of their admitted claims, so that they are able to receive minimum 50% of their principal dues. The above since ArcelorMittal has already made additional provision of `196 crore meant only for those operational creditors whose debt value is less than Rs 1 crore. Further details of the ArcelorMittal\u2019s resolution plan as approved by the NCLT on March 8 include upfront payment of Rs 42,000 crore to secured financial creditors. It has also proposed payment of `17.4 crore to unsecured FCs and further, an amount of `3,055,738 as upfront amount to unsecured FCs whose admitted claims are less than Rs 10 lakhs.