SC admits Videocon RP’s appeal seeking documents from suspended top brass

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September 14, 2021 3:10 AM

A Bench led by Justice Indira Bannerjee while admitting the appeal stayed a part of the NCLAT’s order that remitted the case back to the NCLT.

The commercial court heard both the parties and reserved its orders on June 7.The commercial court heard both the parties and reserved its orders on June 7.

The Supreme Court on Monday admitted an appeal by Pravin R Navandar, the insolvency resolution professional (RP) of Videocon Oil Ventures (VOVL), seeking documents from the suspended management led by Venugopal Dhoot and others for determination of avoidance transactions related to the debt-laden firm’s subsidiaries through which the participating interest in oil and gas blocks are allegedly held in Brazil.

A Bench led by Justice Indira Bannerjee while admitting the appeal stayed a part of the NCLAT’s order that remitted the case back to the NCLT.

“There will be stay of operation of the judgment and order impugned to the extent the matter has been remitted back to the National Company Law Tribunal, with a direction to adjudicate the same afresh, for a period of eight weeks or until further orders, whichever is earlier. Let the appeal be listed for final disposal on October 27,” the apex court said in its brief order.

Navandar has challenged the NCLAT July order that held that erstwhile promoters, including Doot, who is the managing director of Videocon Industries (the holding company of VOVL), were not responsible to assist the RP by providing necessary documents and information required for investigation and determination of avoidance transactions, preparation of the information memorandum and undertaking various statutory compliances.

Senior counsel Sanjiv Sen, appearing for the RP, argued that the information sought from Dhoot and others was necessary to preserve the value of the property of corporate debtor and manage its the operations as a going concern. The list of documents sought by the RP pertained to the VoVL’s subsidiaries, more particularly Videocon Hydrocarbon Holdings and Videocon Energy Brazil, through which the participating interest in oil and gas blocks in Brazil are held.

It was necessary for the appellant to collect information pertaining to the subsidiaries of the corporate debtor, more particularly VHHL and VEBL, as the oil and gas assets in Brazil comprise significant operations from which the corporate debtor derives a significant portion of its value.

Navandar said the apprehensions with respect to the occurrence of avoidable transactions were confirmed by the revised draft of the Transaction Auditor’s report of July 13 (subsequent to the passing of the Impugned Order), making many key observations.

If the required information was not made available to the RP and if the transactions forming the subject of the Transaction Auditor’s report cannot be looked into on account of lack of evidence, it would lead to a significant loss to the CoC, comprising public sector banks, and ultimately a significant loss of public monies, the RP stated in its appeal. He added that the total value of potential avoidable transactions was to the tune of around Rs 16,300 crore.

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