Lenders of Reliance Capital on Monday told appellate tribunal NCLAT that there are no fetters on the power of creditors for negotiating over resolution plans in pursuit of higher valuation for the stressed asset. The intent of the Insolvency & Bankruptcy Code (IBC) is to maximise the value of the assets and the Committee of Creditors are free to negotiate with the terms for that, advocate Kapil Sibal said concluding arguments on behalf of lenders.
Lenders of Anil Ambani-promoted Reliance Capital had moved the NCLAT (National Company Law Appellate Tribunal) challenging an order of the NCLT which restricted further auction of the bankrupt firm. The Mumbai bench of the NCLT (National Company Law Tribunal), on February 2, had 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.
Sub-clause (1-A) to Regulation 39 of IBC allows the lenders power for negotiations on the resolution plans, said Sibal representing Vistra ITCL (India), one of the creditors of Reliance Capital. Senior advocate Mukul Rohatgi, representing Torrent Investments, would argue on Tuesday. "Kapil Sibal, learned senior counsel for the appellant, has completed his submission in the rejoinder," said the NCLAT order.
A request has been made on behalf of Mukul Rohatgi, senior counsel representing Torrent Investment, as he wanted to add one more submission on behalf the firm."List these appeals tomorrow on 21.02.2023 for the submission of Rohatgi. Learned counsel for the appellant shall also be given an opportunity to add in the rejoinder, if any," said the NCLAT bench comprising Chairperson Justice Ashok Bhushan and Justice Barun Mitra. The NCLAT was hearing the plea filed by Vistra ITCL (India), one of the lenders, and Hinduja group firm Indusind International Holdings Ltd (IIHL) against the order of the NCLT.
Torrent Investments had filed a plea on January 9, requesting the tribunal to quash the lenders' plan to hold a fresh auction for the takeover of RCap. Later, the Hinduja group firm also filed petition challenging the NCLT order. Torrent Investment was the highest bidder offering Rs 8,640 crore in the last round of the 'challenge mechanism'. Reliance Capital has a consolidated debt of about Rs 40,000 crore.
