The National Company Law Appellate Tribunal (NCLAT) has set aside an order to liquidate EPC firm Jyoti Structure. It has also asked the Mumbai Bench of the National Company Law Tribunal (NCLT) to consider the ₹4,000-crore resolution plan submitted by Sharad Sanghi and others.

Allowing the appeal filed by Sanghi in this regard, a two-member NCLAT Bench headed by Chairman Justice SJ Mukhopadhaya remitted back the matter to the NCLT, directing it to pass an order within two weeks.

Last July, the NCLT had rejected the resolution plan submitted by Sanghi and passed an order to liquidate Jyoti Structure, which had a debt of ₹7,010.55 crore.

Resolution proposal

According to the ₹3,965.06-crore resolution plan submitted by Sanghi, MD and CEO of IT solutions provider Netmagic, ₹50 crore will come as an upfront payment followed by ₹75 crore in the next one year. The remaining will come as staggered payments in 15 years from the effective date.

Earlier, the Committee of Creditors (CoC) saw 62.66 per cent votes in favour of the resolution plan, while 23.12 per cent was against and the remaining 14.21 per cent abstained from voting. Later, some members of the CoC changed their plans and the plan got 81.3 per cent approval.

However, Sanghi’s resolution plan was rejected by the NCLT on two grounds: the total period of 270 days as mandated under IBC had lapsed by the time last voting took place, on April 2, 2018, and was approved with majority; secondly, as on March 26 and 27, 2018, the voting percentage was 62.66 per cent, which was less than 75 per cent votes of financial creditors.

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