Essar Steel: NCLAT admits Numetal and Arcelormittal appeals

NEWDELHI: The National Company Law Appellate Tribunal (NCLAT) on Tuesday directed the insolvency resolution professional and committee of creditors (COC) for Essar Steel Ltd as well as National Company Law Tribunal’s (NCLT) Ahmedabad bench to not pass any order, including an order of liquidation, with respect to Essar Steel’s insolvency.

This order effectively puts the corporate insolvency process for debt-ridden Essar Steel on hold.

A two-judge NCLAT bench headed by justice SJ Mukhopadhyay also admitted the cross appeals moved by two resolution applicants for Essar Steel, Arcelormittal India Pvt. Ltd and Numetal Ltd, and listed them to be heard on a daily basis from July 23. Meanwhile, the resolution professional would continue discharging his duties with respect to the management of the company.

In April, NCLT had set aside the first round of bidding for Essar Steel by Numetal and Arcelormittal on the ground that the COC and the resolution professional did not follow the procedure prescribed under the Insolvency and Bankruptcy Code (IBC).

The tribunal, however, allowed the two final resolution applicants, Arcelormittal and Numetal, to cure their ineligibility under Section 29A.

While Arcelormittal was disqualified for its relation with debt-ridden Uttam Galva and KSS Petron, Mauritius-based Numetal was disqualified for being indirectly held by Essar promoters, the Ruia family.

Arcelormittal has challenged its disqualification under the IBC. Numetal, backed by Russia’s VTB Capital, has not only challenged its own disqualification but also disputed the permission granted to rival Arcelormittal to clear bank dues of associate companies to cure its ineligibility.

Following NCLT’S direction, Arcelormittal has deposited ₹7,000 crore in an escrow account with the State Bank of India to settle the dues of Uttam Galva Steels and KSS Petron on the condition that it is declared the successful resolution applicant for Essar Steel. NEW DELHI: The board of troubled Fortis Healthcare Ltd is likely to meet Wednesday to consider the outcome of the shareholders’ vote to remove four directors, three of whom had resigned this week.

The board is also expected to discuss the future course of action with regards to the offer made by the combine of Sunil Munjal-anand Burman to acquire Fortis and it may also look into reconstituting itself with the new members, two people aware of the matter said. Mint could not verify it independently.

“The counting of votes was going on. They will sign off on the removal of three directors and the likely fate of one (Brian Tempest). The board may also discuss the need for new board members, if at all,” one of the persons mentioned above said requesting anonymity.however, another person involved with the deal said that it is unlikely that the board will be reconstituted.

“It will be frivolous to do that at this juncture because whoever gets to buy Fortis would like to have the board reconstituted all over again,” said the second person. An extraordinary general meeting of the shareholders of the hospital operator was held on Tuesday to vote on the removal of its four directors. Out of the four, three directors —Tejinder Singh Shergill, Harpal Singh, Sabina Vaisoha, had already resigned and only Tempest, the fourth director faced the vote and continued to be on thard at the time of voting.