The National Company Law Appellate Tribunal (NCLAT) on Thursday allowed a petition filed by lenders of Reliance Capital seeking another round of auction for the debt-ridden firm undergoing insolvency process. A two-member bench set aside an order passed by NCLT and said the Committee of Creditors (CoC) has the power to negotiate and call for a higher bid.
The appellate tribunal permitted the CoC to continue with the challenge mechanism and invite bids after two weeks. The NCLAT order came on a petition filed by Vistra ITCL (India), one of the lenders of Anil Ambani-promoted Reliance Capital, challenging an order of NCLT which restricted further auction of the bankrupt firm.
In the Reliance Capital
The NCLT had on February 2 said the challenge mechanism for financial bids stood concluded as on December 21, 2022, with the bid of Torrent Investments at Rs 8,640 crore being the highest.Torrent Investments had filed a plea on January 9, requesting the tribunal to quash the lenders’ plan to hold a fresh auction for takeover of RCap. Later, IIHL also filed a petition challenging the NCLT order.
Torrent Investments was the highest bidder offering Rs 8,640 crore in the last round of the ” challenge mechanism”. IIHL has also challenged the NCLT order before the appellate tribunal. RCap has a consolidated debt of about Rs 40,000 crore.