Binani’s operational creditors approach Supreme Court

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New Delhi | Published: April 11, 2018 4:41:21 AM

Binani Cement is facing insolvency proceedings for dues of over Rs 7,000 crore.

supreme court, binani, binani cementThe apex court has agreed to hear on Friday the petition challenging various provisions of the Insolvency and Bankruptcy Code (IBC), 2016.

The Binani Operational Creditors Forum (BOCF) has approached the Supreme Court seeking a direction to Vijaykumar V Iyer, the resolution professional (RP), and the committee of creditors (CoC) of Binani Cement not to finalise any resolution plan without safeguarding their interests.

Binani Cement is facing insolvency proceedings for dues of over Rs 7,000 crore.

It also wants participation in the meetings of the CoC and that the National Company Law Tribunal, Kolkata, should not implement any such resolution plan without securing their interests.

The apex court has agreed to hear on Friday the petition challenging various provisions of the Insolvency and Bankruptcy Code (IBC), 2016. Seeking protection of their rights and interests, it has alleged discrimination against different classes of creditors under the IBC

Unlike the Companies Act, 1956 and 2013, the IBC seeks to “arbitrarily and unfairly discriminate and divide” unsecured creditors into two classes, unsecured financial creditors and operational creditors.
Pointing out at the discriminatory treatment meted out to the class of operational creditors and preferential treatment given to the financial creditors, it said that IBC was created for protecting the interests and rights of all the stakeholders including both financial and operational creditors.

Making the rights of operational creditors subservient to those of financial creditors, is contrary to law and in violation of Article 14 (equality before law), 19 (1) (g) (freedom of profession,trade) and 300 A(right to property) of the Constitution of India, the petitioners stated.

According to the petition, unlike financial creditors, the operational creditors are totally dependent on the recoveries made from the corporate debtors against goods and services provides to them. The FC, on the contrary and in the usual course of business, have their debts secured by a security created by the corporate debtor in their favour and have the remedy to enforce security to recover their debts.

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