Guj HC junks Essar Steel plea against RBI's insolvency order

Gujarat HC raps RBI for giving directions to NCLT

The Gujarat High Court on Monday dismissed Essar Steel India Ltd's appeal against a central bank order that asked creditor banks to start insolvency proceedings against the steelmaker, lawyers on the case said.

Essar Steel in its petition to the court had challenged a June 13 directive of RBI, in the form of a press release, in which the banking regulator directed banks to refer a dozen cases, including Essar Steel, directly to NCLT.

Following the RBI direction, a joint lenders' forum led by State Bank of India (SBI) and initiated proceedings in the NCLT under the newly-formed IBC.

Essar Steel had moved the high court challenging the RBI's June 13 circular asking the banks to initiate action against the company and eleven other accounts (companies) with over Rs 5,000 crore of outstanding loans each under the Insolvency and Bankruptcy Code (IBC).

Brand new Ford Fusions loaded with $1 million worth of Marijuana
Agents traced the auto back to a Warren area rail yard, where the vehicle was unloaded from a train, along with fourteen other Fords.

The court had earlier stayed the insolvency proceedings against Essar Steel before the National Company Law Tribunal (NCLT) as an interim measure on its plea. However, Essar continued to raise objection on being clubbed with other 11 NPA accounts, whereas it was in discussion with banks for a financial restructuring.

Essar Steel owes lenders around Rs 45,000 crore ($6.99 billion), of which Rs 31,670 crore had become non-performing as of 31 March 2016, the Mint newspaper previously reported citing court hearings. Standard Chartered Bank had also moved the NCLT against Esaar.

The steel company's debt has increased to over Rs 42,000 crore. They will take a decision in a day or to as time is a critical factor in this. Essar Steel argued that it was not given adequate opportunity to present its position before the insolvency case was filed at the NCLT. Instantly acknowledging this error, the RBI told the Gujarat High Court that it would withdraw this line from the press release, and did so by the means of a corrigendum.

Though the Insolvency and Bankruptcy Code is in force since December 2016, the lender banks did not opt for insolvency proceedings because they knew it would "jeopardise company's operations" as suppliers may stop supplying material on learning about such action, Thakore said. While arguing before the court, the RBI counsel had informed the court that these 12 NPA accounts represent 25 per cent of the total NPA of Rs. 7,50,000 crore, which forms 5 per cent of the country's GDP.

Related News:



Most liked

South Korea offers rare talks with North to avoid border conflict
Seoul's acting Red Cross chief Kim Sun Hyang said it wants separate talks at the border village on August 1 to discuss family reunions.

Andre De Grasse wins 200 metres in Morocco
Meanwhile, there was a significant home win for Morocco's Soufiane El-Bakkali in the men's 3000m steeplechase. He was pleased with his run, but has yet to go under 20 seconds this season.

Chelsea Keen On Sergio Aguero
Premier League holders Chelsea could reportedly land the services of Sergio Aguero during this summer's transfer window. Spanish journalist Manu Sainz claimed last night that the Premier League champions were interested in the City hitman.

Seoul offers military talks with Pyongyang
China Customs said Thursday that the country's overall trade with North Korea had grown 10.5 percent in the first half of the year.

Donald Trump has lowest approval ratings of any U.S. president in history
Thirty-eight per cent of those surveyed believe Trump is making significant progress towards his goals, while 55% feel he is not. However, 48 percent "disapprove strongly" of his performance overall, a level never reached by his two Democratic predecessors.

AC Milan are buying all the strikers, leaving none for Chelsea
However, Italian outlet CalcioMercato claim the Stamford Bridge club could be about to miss out on the forward to AC Milan . Belotti was absent from Torino's kit launch on Sunday, which could be an indication that he is set to move on this summer.

DeChambeau birdie blast wins John Deere
Halfway through the final round, DeChambeau ran into trouble; he was even on the front nine and several shots back from the lead. But Rodgers bogeyed No. 14 on Sunday, as well as No. 17 - another hole where birdies were there for the taking.

Artificial sweetners may lead to weight gain
Both types of studies have their pluses and limitations. "I used to be a person who put Splenda in my coffee every day", she says. But that's a very different message than outright recommending sweeteners for weight loss or better health, she says.

Slight growth in house prices in July: Rightmove
The Bank of England is also debating whether to raise interest rates to keep inflation in check. The annual rate of price gains was nearly 8 per cent in May a year ago .

Our next President is going to be elected on Monday
MLAs from different parties reached the state Assembly well ahead of the scheduled time for the commencement of voting process. The pen will be taken back by the polling staff once the voting is done and the legislator exits the voting chamber.

Call of Duty WWII Zombies Mode: Sledghammer Is Disappointed With The Leak
The dev studio has already revealed its involvement on the latest installment in the Call of Duty franchise, Call of Duty : WWII . However, Sledgehammer has been rather tight-lipped about the game's upcoming zombie mode .

Mourinho Ready to Sign Toni Kroos for Manchester United
Manchester United's Ander Herrera claims there is no truth in reports linking himself with a move to Barcelona this summer. The report claims Morata, born and bred in Madrid, will move for around £61m and will then pocket a £170,000-a-week salary.

Facebook plans ads on all its platforms, including WhatsApp
Monetizing policy is being more focused at Facebook and lately it is learned the Facebook Messenger app to get advertisement too. You might have tried to run away from ads, but they keep appearing everywhere, invading our News Feeds and even our messages.

Miranda Kerr Reveals Her Stunning Wedding Dress!
She said recently: "Our wedding was just so joyful". "When I was young, my grandmother told me, 'Miranda , men are very visual. Miranda wore it with a delicate two-tier veil and simple pearl earrings to match the embellishments in the headpiece.

Fully Immersive Super Hero Experience Coming to Disney's California Adventure
It will be patterned after the Ratatouille ride at Disneyland Paris, the top family attraction at that park, according to Disney. The park is undergoing something of an upgrade in the run up to Walt Disney World's 50th anniversary in 2021.