The Ruias on Thursday offered to pay lenders Rs 54,389 crore to retain Essar Steel hours after the committee of creditors (CoC) voted on the bid by Arcelor Mittal. The Ruias offered to pay the dues under Section 12A of the Insolvency and Bankruptcy Code (IBC), introduced in 2018 by way of an amendment. Meanwhile, sources said 90% of the lenders on the CoC had voted in favour of the bid by ArcelorMittal, which has promised at least Rs 39,500 crore by way of cash upfront. Eminent lawyer Shardul Shroff, founder, Shardul Amarchand Mangaldas, said Section 12 A would not be applicable in this case. \u201cSection 12A is valid only before the EoIs come in. But here not only have the EoIs come in, the CoC has finished voting on the two proposals as mandated by the Supreme Court,\u201d Shroff explained. Shroff, who was speaking to FE only in his personal capacity, observed that on a reading of the Supreme Court order, it was very clear there has to be a re-submission by Numetal and Arcelor, and Essar by itself was not a party or a bidder. \u201cSo, for them to come in at this stage would be a violation of the Supreme Court order because they were not a party entitled to open the whole round,\u201d he explained. State Bank of India (SBI) had referred Essar Steel to the NCLT seeking a resolution via the corporate insolvency resolution process under the IBC. Essar Steel owes lenders about Rs 49,000 crore. The Ruias have agreed to make an upfront cash payment of Rs 47,507 crore to all creditors, including payment of Rs 45,559 crore to the senior secured financial creditors. Essar Steel indicated in its release that while \u201cthe resolution plan currently under the CoC\u2019s consideration takes care of only the secured creditors (i.e. the banks), by offering this settlement, the shareholders of ESIL are ready to pay up the entire dues that will lead to not only maximum recovery for the lenders, but also for all other classes of creditors, thus taking the company out of the corporate insolvency resolution process under Section 12A of the IBC.\u201d Arcelor Mittal has agreed to pay a total of Rs 50,000 crore including Rs 39,500 crore of cash upfront, Rs 8,000 crore of capital infusion into the company and approximately Rs 2,500 crore of working capital. Over and above this, it will make payments to operational creditors and to workers. Responding to Essar Steel promoters' latest offer to take the company out of the ongoing insolvency resolution process, ArcelorMittal in a statement said, \u201cOur understanding is that the IBC\u2019s section 12A does not apply to the resolution process of Essar Steel.\u201d The release stated that as per Section 12A, application to withdraw must be submitted prior to issuance of the invitation for expressions of interest (EoI) and must be accompanied by a bank guarantee for the specified amounts, adding EoI for Essar Steel were issued in October 2017. Last week, in keeping with the country's Supreme Court ruling, ArcelorMittal approved a payment of Rs 7,469 crore to financial creditors of Uttam Galva and KSS Petron to clear overdue debts so that its April offer for Essar Steel can be considered eligible. ArcelorMittal's offer is a revision to the second round of bids that lenders and the resolution professional Satish Kumar Gupta had called for back in April after the first round of bids submitted by ArcelorMittal and Numetal, a company co-owned by Russia\u2019s VTB Bank were found to be ineligible. Separately, earlier this week, VTB, through Crinium Bay, which holds a 40% equity in Numetal, has petitioned the Supreme Court seeking permission to bid independently or jointly with \u201ca suitable partner\u201d for the debt-laden Essar Steel.