NCLT APPROVES BURN STANDARD RESOLUTION PLAN

The National Company Law Tribunal (NCLT) on Tuesday approved the resolution plan for Burn Standard Company, which comprises a ~4.17 billion package. However, around 160 former officers of the state-owned wagon maker have decided to move the National Company Law Appellate Tribunal (NCLAT) to contest the decision.

According to sources, the resolution plan includes clearing of dues of the financial and operational creditors and a voluntary retirement scheme for around 500 employees. United Bank of India is the sole financial lender to Burn Standard Company, besides there are 196 other operational creditors, whose consolidated exposure to the company is ~620 million.

Company sources said the railway ministry had created a ~4.17 billion package as a part of the budgetary provision for Burn Standard and based on this the resolution professional had proposed the plan to the NCLT.

The plan has been accepted by the current employees, who fear the company, which traces its origin back to 1781, may be closed down by the railway ministry. The former employees have contested the resolution plan, terming it

“arbitrary and illegal”.

According to Anutosh Bandyopadhyay, president of Burn Standard Ex- Officers Welfare Association (BSEOWA), the resolution professional did not submit the plan to the former employees, who are a party to the case.

Furthermore, he alleged the plan did not include payment of dues and arrears to the former employees, which is estimated at ~1.5 billion.