The National Company Law Appellate Tribunal (NCLAT) on Thursday completed hearing on Tata Steel’s petition, challenging the lenders’ discretion to allow JSW Steel to revise its bid for bankrupt Bhushan Power and Steel (BPSL). The appellate tribunal has reserved its order on the matter.
A two-member Bench, headed by Justice SJ Mukhopadhaya, asked all parties to make written submissions by December 26.
The NCLAT’s order will expedite resolution of the steelmaker that owed lenders close to `47,000 crore as on March 31, 2017. On Punjab National Bank’s plea, BPSL was admitted for initiating the corporate insolvency resolution process (CIRP) by the New Delhi bench of the National Company Law tribunal (NCLT) on July 26, 2017.
Though late-entrant Liberty House was in the reckoning for BPSL, the fight to take over the company is mainly between JSW Steel and Tata Steel. Lenders had on July 31 selected Tata Steel as the H1 bidder and JSW Steel as the H2 bidder for BPSL. This was done at the instance of the appellate tribunal which, on July 20, had asked the CoC to select the H1 and H2 bidders. However, on July 27, the CoC allowed JSW Steel to submit a revised bid for the steelmaker. Tata Steel challenged the CoC’s decision in NCLAT on July 30.
However, on August 1, the NCLAT had again allowed submission of revised bids by all three bidders, including UK-based Liberty House. Following this, on August 13, JSW Steel raced past Tata Steel to emerge as the most preferred bidder for BPSL which has around 3 million tonne per annum steel-making capacity.
Sources said JSW Steel has offered to pay `19,350 crore to the financial creditors of the company. Apart from this, the company has offered to pay `350 crore to the operational creditors against their admitted claims of `700 crore. Tata Steel’s total bid is of `17,000 crore.
Senior counsel Abhshek Manu Singhvi, appearing for Tata Steel, on Thursday alleged that the CoC gave JSW Steel undue chances to revise its bid after declaring Tata Steel as the highest bidder.
JSW, represented by Kapil Sibal, had earlier argued, “Tatas can’t ask why I (JSW Steel) was given the opportunity. It’s a financial bid and I can improve it. Until voting on bids happens, the door is not closed.”
Sibal also said Tata Steel should not come before the NCLAT till the CoC approves a bid or the other as “it is against the statute”.