Numetal just a ‘shell firm’: ArcelorMittal

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New Delhi | July 05, 2018 4:25 AM

A day after Numetal questioned ArcelorMittal’s eligibility to bid for the bankrupt Essar Steel in the National Company Law Appellate Tribunal (NCLAT), the latter on Wednesday responded, saying that Numetal was just a “shell company” formed for the purpose of submission of the resolution plan.

arcelor mittal. steel industryAs a promoter for two defaulting firms — UttamGalva and KSS Petron — ArcelorMittal had not yet paid the dues to become eligible to bid for Essar Steel. (Reuters)

A day after Numetal questioned ArcelorMittal’s eligibility to bid for the bankrupt Essar Steel in the National Company Law Appellate Tribunal (NCLAT), the latter on Wednesday responded, saying that Numetal was just a “shell company” formed for the purpose of submission of the resolution plan.

Senior counsel Abhishek Manu Singhvi, appearing on behalf of ArcelorMittal, said: “This is evident from the manner in which Numetal and Aurora Enterprises were incorporated on the same date in Mauritius in 2017.”

Hearing the cross-plea of both the companies over which bid should be valid — one from the first round or the second — the two-member NCLAT bench headed by Justice SJ Mukhopadhyay placed the matter for further hearing on Thursday.

Russia’s VTB Bank-led Numetal on Monday had argued that ArcelorMittal was not eligible to bid for Essar Steel under Section 29 (A) of the Insolvency and Bankruptcy Code (IBC).

Appearing on behalf of Numetal, senior counsel Mukul Rohatgi had said Section 29 (A) (c) prohibits a person from submitting a resolution plan if such person fails to make payment of all overdue amounts with interest thereon and charges relating to non-performing asset accounts before submission of resolution plan.

As a promoter for two defaulting firms — UttamGalva and KSS Petron — ArcelorMittal had not yet paid the dues to become eligible to bid for Essar Steel. Mere transfer of the dues to an escrow account does not mean that the amount has been paid and make it eligible to bid for the company, Rohatgi had argued.

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