The Supreme Court on Monday allowed the National Company Law Tribunal to continue processing bids for Ruchi Soya Industries, which is undergoing insolvency proceedings, but restrained it from finalising the bid without its approval.
he Supreme Court on Monday allowed the National Company Law Tribunal to continue processing bids for Ruchi Soya Industries, which is undergoing insolvency proceedings, but restrained it from finalising the bid without its approval. Mumbai-based edible oil maker Ruchi Soya, whose leading brands include Nutrela, Mahakosh, Sunrich, Ruchi Star and Ruchi Gold, has a total debt of about Rs 12,000 crore. The company was admitted for the Corporate Insolvency Resolution Process (CIRP) on December 8 after its two creditors — Standard Chartered Bank and DBS Bank —had moved the NCLT, Mumbai.
A Bench headed by justice RF Nariman passed the order on an appeal filed by Ruchi Soya’s suspended director Vijay Kumar Jain who had challenged the National Company Law Appellate Tribunal’s August 9 order that refused to direct resolution professional Shailendra Ajmera to give all the documents including the resolution plan to the suspended board of directors (BoD) including him.
However, the appellate tribunal had allowed them to attend meetings of the committee of creditors and submit their suggestions to the RP on the basis of the discussions in the CoC meeting.
Seeking transparency in the insolvency proceedings, Jain argued before the SC that without being provided with the copies of the RP and the relevant documents, the presence of suspended BoD “shall be nothing but an act of futility as no valid input can be given”.
According to him, the NCLAT had failed to appreciate that the object and spirit of maintaining confidentiality by the RP and discussions pertaining to the CIRP is to be exercised against third parties and not against persons statutorily entitled to participate in the CoC meetings. “The findings in the impugned order virtually result in violation of the principles of natural justice and the provisions of the IBC and its regulations,” the appeal stated.
Ruchi Soya, which owes around Rs 33 crore to Standard Chartered and around Rs 150 crore to DBS Bank, figured in the RBI’s second list of 28 defaulters. Baba Ramdev’s Patanjali Ayurved, Godrej Agrovet, Kolkata-based Emami Agrotech, an edible oil and biodiesel arm of Emami Group, and Adani Wilmar are in the fray to acquire assets of the company. However, after the two rounds of bidding, the CoC had approved Adani Wimar’s bid for the bankruptcy-bound company with about 96% votes in favour. Adani and Patanjali group have been engaged in a long-drawn battle to take over Ruchi Soya. While Adani Wilmar emerged as the highest bidder with a `6,000-crore offer, Patanjali came second with a `5,700-crore bid.