The National Company Law Appellate Tribunal (NCLAT) Rejects Prashant Ruia’s Plea

New Delhi: The National Company Law Appellate Tribunal (NCLAT) on Thursday rejected Essar Steel promoter Prashant Ruia's plea against the Rs 42,000 crore bid of ArcelorMittal to acquire the insolvent steel company.

The NCLAT said that financial creditors are one class of creditors and have to be treated similarly. It also noted that the Committee of Creditors does not have the authority to decide on the distribution of the bid amount, and it is the insolvency resolution professional who will decide on it. The appellate tribunal also said that distribution of amount to the operational and financial creditors should be be reflected in ArcelorMittal’s resolution plan.

Commenting on the judgement, an Essar spokesperson said: “It appears that new facts regarding ineligibility under Section 29A (of the Insolvency and Bankruptcy Code), which emerged only after the previous judgement of the Supreme Court, have not been given due consideration. We are awaiting the detailed order and will decide our course of action thereafter.” (IANS)

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