The National Company Law Appellate Tribunal on Tuesday issued notices to Torrent Group and other respondents to file their replies within three days to a petition seeking a second round of e-auction for debt-ridden Reliance Capital, which is at present undergoing the insolvency resolution process.
A two-member bench of the National Company Law Appellate Tribunal(NCLAT)has listed the case for a hearing on Thursday.
The decision came after lenders of the firm led by Vistra ITCL (India) moved the appellate tribunal against a National Company Law Tribunal’s (NCLT)February 2 order that declared the proposed second e-auction as a violation of the bankruptcy rules.
The tribunal also termed Torrent Group as the highest bidder under the first challenge mechanism and directed the administrator to take the process to its “logical conclusion”.
Following this, Rcap lenders moved the appellate tribunal stating not holding another round of auction would lead to an upfront loss of ₹5,010 crore.
According to the committee of creditors (CoC), RCap’s admitted debt is more than ₹25,000 crore, including public money and the objective of the insolvency process was to pursue “value maximisation”.
The CoC was “disappointed time and again with the offers from the bidders”, they said among reasons for moving the appellate tribunal.
They also alleged that the entire corporate insolvency resolution process has come to a standstill as the plans were not presented to the CoC and the second mechanism was kept in abeyance. The petition has also stated that there were a number of inaccuracies in NCLT’s February 2 order.
Under the first challenge mechanism, Torrent Group had presented a resolution plan with a net present value (NPV) of ₹8,640 crore while that by Hinduja Group was at ₹8,110 crore.