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In what appears to be a move to set off a rethink among Binani Cement’s creditors on UltraTech’s bid, Dalmia Bharat Group arm Rajputana Properties — the highest bidder for Binani Cement — has claimed that by proposing an out-of-court settlement, promoter Braj Binani is trying to front for the losing bidder and aiming to suppress serious charges of fraud against the company.
In separate letters written to the RBI and the Committee of Creditors of Binani Cement Ltd (BCL) but not marked to Binani Cement, Rajputana Properties alleged that Braj Binani’s real motive is to front for UltraTech at the fag end of a nearly nine-month-long IBC process, and escape the consequences of serious fraud charges of ₹2,400 crore in BCL.
While UltraTech refused to comment as it has not seen the letter, a Binani Cement spokesperson told BusinessLine the company is looking forward to a hearing in the Supreme Court on April 13 to pay off the lenders and release the pledge.
ALSO READ : ‘Lack of transparency in Binani Cement bidding process’
NCLT notice
The letter alleged that Binani Industries Ltd (BIL), which owns BCL, is itself insolvent and owes over ₹1,700 crore to creditors for several years. NCLT Kolkata has issued notice to the company on a winding-up petition, said the letter, urging creditors to confirm the deal with Dalmia Group in three days. “BIL lenders have called in the guarantees. His (Braj Binani’s) intent to sell BCL stake to UltraTech (the losing bidder) is a clever ploy to offer UltraTech a back-door entry and dislodge the highest bidder, Rajputana Properties,” the letter alleged.
The letter to the RBI comes even as the Supreme Court is to take up for hearing on Friday a BIL petition seeking approval for an out-of-court settlement with creditors.
Mahindra Singhi, Group CEO, Dalmia Bharat Cement, told BusinessLine that the company will present the facts in the apex court. The Rajputana letter alleged that the BIL proposal of an out-of-court settlement is an attempt to hide culpability for the loss of ₹2,400 crore caused by the fraudulent trades by BIL promoter Braj Binani in BCL.
In the light of daily frauds in the banking sector, any settlement with BIL will be scandalous, illegal, contrary to law and make the bank a co-conspirator to yet another fraud and become a reputation issue for lenders, said the letter, seeking their support for Dalmia Bharat’s bid.
It may be noted that the NCLT has given banks the liberty to consider an out-of-court settlement, but did not direct the banks to violate laws , act contrary to Central Vigilance Commission or Indian Banks’ Association guidelines, the letter stated.
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