NCLAT Dismisses Interups' Plea Against ACCIL Insolvency Stating Appellant Not An Aggrieved Party
The National Company Law Appellate Tribunal (NCLAT) has rejected a plea filed by Interups Inc. (Appellant). The US Based- Company challenged the decision of the National Company Law Tribunal (NCLT) wherein the Tribunal had approved the bid in October 2020 of JSW Steel Coated Products for the Asian Colour Coated Ispat Ltd. (ACCIL).
A three-member bench of the NCLAT headed by the Acting Chairperson Justice Bansi Lal Bhat stated that Interups neither qualifies as a resolution applicant nor as a prospective resolution applicant or as a successful or unsuccessful resolution applicant for ACCIL.
The Appellate Tribunal rejected a plea filed by Interups Inc challenging the National Company Law Tribunal's (NCLT) approval for JSW Steel group's Rs 1,550 crore-bid for ACCIL.
ACCIL had a total debt of approx. Rs 6,500 crore and the company specializes in downstream, galvanized, and colour-coated products which are exported to Europe, Latin America, and Africa. It went into insolvency in July 2018 after the NCLT admitted an application by the State Bank of India.
The appellant has asked for EOI (Expression of Interest) on 12 June 2020, when the application seeking approval of the resolution plan was filed by Resolution Professional on 10 July 2019 after the Committee of Creditors (CoC) approval on 28 June 2019 with 79.3 percent voting share.
The Resolution Plan issued Form G, inviting EOI on 1 October 2018, and it was revised on 14 December 2018. The last date for receipt of the resolution plan was 8 March 2019. EOI was received from 12 resolution applicants and 11 of them were found eligible, as per the NCLAT.
The NCLAT observed that the appellant was a 'stranger' to the insolvency resolution process till 11 June 2020. On 12 June 2020, it had expressed its interest to submit a resolution plan through an e-mail marked to all CoC members, and no financial proposal was provided.
The Appellate Tribunal stated, "Appellant (Interups) has asked for EoI on June 12 2020 when an application seeking approval of resolution plan was already filed by Resolution Professional on 10 July 2019 under Section 31 of Code after CoC approval on 28 June 2019 with 79.3 percent voting share."
The NCLAT added while dismissing the petition, that Interups wanted to enter the fray for ACCIL nearly one year after the CoC gave its approval for the resolution plan.
The bench added that the appellant cannot be termed as an aggrieved party and its appeal against the order of the NCLT is liable to be dismissed.
The Appellate Tribunal stated that "Appellant may be termed as an outsider standing on the sidelines. Corporate Insolvency Resolution Process is time-bound, value maximization has also to be in a time-bound manner."