Companies

NCLAT allows time till November 30 for Vasan Health Care insolvency resolution

Our Bureau Chennai | Updated on November 25, 2021

The NCLT said the resolution process cannot start afresh from the stage of issuance of Expression of Interest as it would upset the timeline prescribed under the Insolvency and Bankruptcy Code

The National Company Law Appellate Tribunal, Chennai, has set aside the order of the National Company Law Tribunal, which refused to give more time for Vasan Health Care insolvency resolution. Both the Committee of Creditors and the Resolution Professional had filed the appeal as the deadline had been exceeded.

The NCLAT has given Vasan Health Care time till November 30 for completing the Corporate Insolvency Resolution Process. The time spent in filing these appeals before the Tribunal from August 18 to November 25 is also excluded, said the order issued by Justice M Venugopal and Kanthi Narahari, Member (Technical).

‘Exceptional circumstance’

The NCLAT comes to a resultant conclusion that based on the facts and keeping in view of exceptional circumstances, and to avoid liquidation as a last resort and to comply with the object of the Code to maximise value of asset of the Corporate Debtor and the law laid down by the Supreme Court in the matter of Swiss Ribbons and Essar Steel, that the outer limit of 330 days can be extended in exceptional circumstance, this Tribunal set aside the order of the Adjudicating Authority dated August 3, the order said.

One of the resolution applicants — Maxvision—- had also filed an intervention application demanding preference since it had submitted the bid within the time-frame fixed by the NCLAT. However, other resolution applicants (Agarwal and one other) filed applications to resist the prayer in the intervention.

The NCLT said the Vasan Health Care resolution process cannot be started afresh from the stage of issuance of Expression of Interest as it would upset the timeline prescribed under the Insolvency and Bankruptcy Code, 2016. The NCLT had granted an extension only till August 22 to finalise the accounts of Vasan Health Care after which, it said, the resolution professional could file a liquidation application.

The NCLAT Bench on October 12 reserved its ‘judgement.’

Also see: NCLAT reserves orders in Vasan Health Care case

In 2017, NCLT Chennai ordered insolvency proceedings to be commenced against Vasan Healthcare based on a petition filed by one of its suppliers - Alcon Laboratories (India) Pvt Ltd. As on September 30, 2021, Vasan Health Care chain’s 29 claimants had a total outstanding of ₹1,749 crore, says information in the company’s website.

Published on November 25, 2021

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