In a fresh twist in the battle for wresting control of beleaguered Binani Cement, operational creditors have now entered the fray with their contention of being wronged in the resolution process.
In a fresh twist in the battle for wresting control of beleaguered Binani Cement, operational creditors have now entered the fray with their contention of being wronged in the resolution process. The Kolkata bench of the National Company Law Tribunal (NCLT) will hear on Tuesday the intervention petition against the resolution professional (RP) filed by a group of small and medium (MSME) creditors of Binani Cement (BCL). The MSME creditors in their petition have accused the RP of meting out an “unfair and unjust” treatment to them. They alleged that their claims against the cement major have gone unheard.
The applicants, Shri Khemisati Polysacks, Balaji Roadlines, Vipul Marketing, Shama Enterprise, Ganpati Plastfab, Sai Shraddha Corporation, Jay Enterprise and Shree Ganpatlal Onkarlal Agarwal, have sought a say in the proceedings and urged an effective check on the financial creditors. They said in their petition that their pleas for considering claims have not been heeded and they have sought NCLT’s intervention to ensure justice to them in the insolvency proceedings against Binani.
The petition by MSME creditors follows accusations of bipartisanship and lack of transparency in the resolution process being alleged by the counsels of UltraTech and Binani Industries. The cement major, following this, had made an offer to acquire the company outside of the resolution process for which it has issued a comfort letter to the promoters offering to infuse Rs 7,266 crore to settle the ailing company’s dues, and in return for equity control. Binani has since applied for withdrawal from the insolvency proceedings.
The MSME creditors realised late in the process that the RP does not intend to provide for payment of their claims in full in the resolution plan, the MSME creditors moved the NCLT arguing that there was no reason whatsoever as to why their dues should not be paid in full. Indian laws provide for greater protection of MSMEs and any dues to them outstanding at the end of a financial year are required to be separately disclosed in annual filings of companies. “This is an issue of paramount importance to us since it involves the fate of over 60,000 people depending on the operational creditors,” a petitioner said, adding that they have contributed to ensure that BCL was resurrected as an ongoing concern. The MSME petitioners alleged that the RP has “mischievously and fraudulently” chosen to collude with interested parties to push a proposal that only favoured financial creditors of the company.