The Kolkata bench of National Company Law Tribunal (NCLT) on Monday directed the Committee of Creditors (CoC) for Binani Cement to consider parent company Binani Industries’ application for an out-of-court settlement.
The bench comprising Justice Jinan KR and Justice Madan Balachandra Gosavi had, in its last hearing on March 27, observed that the application filed by Binani Industries was in the ‘larger interest of all creditors’. Accordingly, it had asked the CoC whether it could consider the same.
The CoC’s counsel submitted that they had not received a copy of last day’s order on considering the out of tribunal settlement.
“The bench has directed us to consider the application at our liberty, we will do as directed,” said Pratap Chatterjee, the CoC counsel.
On being asked if the creditors committee were willing to consider the proposal if they got a copy of the order, Chatterjee sought time. The hearing has been adjourned to April 9.
Binani Industries, which recently entered into an in-principle understanding with UltraTech, offered to pay off all the dues to its creditors within two weeks and pleaded for termination of insolvency proceedings in the Kolkata bench of NCLT.
As per the understanding, UltraTech would acquire 98.47 per cent stake of Binani Industries in the cement unit for ₹7,266 crore subject to ‘termination of insolvency proceedings’. The funds can then be used to pay off Binani Cement’s creditors, including the unsecured ones.
However, on the last hearing on March 27, the CoC counsels had argued that there was no provision in the Insolvency and Bankruptcy Code (IBC) to suspend a resolution process after it has started.
Binani Industry’s counsel Ratnanko Banerjee in his submission, however, argued that under Section 60(5) of the IBC (read with rule 11 of NCLT rule) the tribunal has the “inherent power” to consider the application for withdrawal from the insolvency process.