The Kolkata bench of the National Company Law Tribunal (NCLT) had last month ordered liquidation proceedings against GNCL as a ‘going concern’, as no resolution plan was approved during the stipulated time. Liquidation proceedings against the firm commenced on January 22.
The BSE and the NSE will suspend trading in the equity shares of Gujarat NRE Coke (GNCL) from February 12 as liquidation proceedings have started against the insolvent company. The Kolkata bench of the National Company Law Tribunal (NCLT) had last month ordered liquidation proceedings against GNCL as a ‘going concern’, as no resolution plan was approved during the stipulated time. Liquidation proceedings against the firm commenced on January 22. The tribunal has appointed Sumit Binani, the resolution professional (RP) of the company, as the liquidator. “Hence, to avoid market complications, trading in the equity shares of Gujarat NRE Coke Limited will be suspended with effect from February 12, 2018,” BSE has said in a notice. In a circular issued on February 2, NSE said, “In pursuance of regulations 3.1.2 of National Stock Exchange (Capital Market) Trading Regulations Part A, it is hereby notified that equity shares of Gujarat NRE Coke will be suspended from trading with effect from February 12 (closing hours of trading on Feb 9) pursuant to order dated January 11, passed by the NCLT, Kolkata bench.”
A division bench of the tribunal comprising justices Vijai Pratap Singh and Jinan KR had ordered the start of liquidation proceedings with some conditions. “The liquidator shall try to dispose of the corporate debtor company as a going concern after publication of notice in newspaper with the reserve price which shall be equal to the total debt amount including interest and maximum period applicable for trying the sale of the corporate debtor as a going concern will be three months from the date of the order,” the bench said in the order. The bench also said if the process of sale as a going concern fails during the three-month period, the process of sale of assets of the firm will be according to the provisions for the same under Section 33, Chapter VI of the Insolvency & Bankruptcy Board of India (Liquidation Process) Regulations, 2016.
In April last year, the tribunal had admitted an application by the metallurgical coke producer, the flagship company of Gujarat NRE group, under Section 10 of the Insolvency and Bankruptcy Code (IBC). For the company promoted by Arun Kumar Jagatramka, the moratorium of nine months for completion of the resolution process expired on January 1. However, the company’s creditors had not approved any resolution plan during the stipulated time of 270 days. As the firm’s loans remained non-performing for over a year, its promoters became ineligible under the revised IBC guidelines to submit a resolution plan.
GNCL owes lenders about Rs 4,600 crore. The company’s financial creditors include SBI, BoB, Axis Bank, Standard Chartered Bank, ICICI Bank, Tamilnad Mercantile Bank and DBS Bank. SBI has the largest share among the creditors. According to a disclosure to the stock exchanges, as on December 31, the promoter and promoter group held a 25.36% stake in GNCL, while public shareholding in the Kolkata-based firm was 74.64%.