NCLT admits plea against Sai Wardha

MUMBAI: A bankruptcy court has admitted the insolvency plea against Sai Wardha Power Generation Ltd, which runs a 540megawatt (MW) power plant. The National Company Law Tribunal’s (NCLT’S) Hyderabad bench admitted the insolvency plea filed by fund India Opportunities III Pte Ltd and trustee services firm Vistra ITCL (India) Ltd. They had approached the tribunal with a claim of ₹91.49 crore. NCLT has also approved the name of V Venkatachalam as the interim resolution professional.

“The power firm defaulted on the debenture trust deeds that it entered with the fund and the trust in June 2017. The debentures were subscribed by the investors in two tranches,” said lawyers representing the lenders. “The company issued 390 debentures upon execution of the debenture trust deed in June 2017 and 460 debentures on July 2017 for the aggregate value of ₹85 crore,” they added. The order was given on November 9 but was uploaded on NCLT website on November 16. As of March 31, the firm’s total debt outstanding stood at ₹3,349 crore, of which IDBI Bank Ltd’s exposure was 41%, or ₹1,367 crore.

“The said action (default) of the respondent company was neither wilful nor wanton but was due to its inability to access its existing cash flows for payment of coupon as the main trust retention account is being managed by IDBI Bank and the secured lenders are not confirming the entire stipulations by the financial creditors,” argued the company.

The firm said it is expected to revive in the near future as it has a power purchase agreement for the supply of 157MW cross capacity with its captive industrial consumers.