Ballarpur Industries avoid liquidation for now
Gautam Thapar-owned Ballarpur Industries Ltd (BILT) has avoided liquidation for now as the National Company Law Appellate Tribunal (NCLAT) has stayed the liquidation order for now. The appellate tribunal has instead ordered the committee of creditors (CoC) to reconsider the revised resolution plan submitted by Finquest Financial Solutions within six weeks.
The Mumbai bench of the National Company Law Tribunal (NCLT) had on 25 January 2022 ordered liquidation of Ballarpur Industries after the CoC rejected the only resolution plan submitted by Finquest Financial Solution, one of the financial creditors.
After the NCLAT order, the resolution professional in this case — Anuj Jain — has called the meeting of the CoC on 14th March 2022.
The appellate tribunal said in its order dated 7th March that it is of the view that ends of justice be served in issuing direction to the CoC to reconsider the Revised Resolution Plan within a period of six weeks from today. “It goes without saying that resolution professional should convene a meeting of CoC for reconsideration of the revised plan forthwith,” said appellate tribunal.
The appellant — Finquest Financial Solutions — argued in NCLAT that while the order of liquidation was made on 25 January 20222, the order was uploaded on NCLT website only on 22 February. During this time, it had submitted its revised plan on 7th February.
It must be noted here that Finquest Financial Solutions is also one of the financial creditors with 5.5% voting share with total claimed amount of Rs 175 crore.
The revised plan was discussed in the CoC meeting on 11 February, and the CoC asked the resolution professional to file an application before the NCLT to reconsider the plan. The resolution applicant – Finquest Financial Solutions – had also requested the NCLT to not pass any order of liquidation since the application seeking reconsideration of revised resolution plan was pending.
The NCLAT would hear the case again on 19th of April 2022.
The insolvency petition against Ballarpur Industries was filed by Finquest Financial Solutions in January 2020 for defaulting on payment of Rs 68 crore. Total claims of all creditors amount to over Rs 3,500 crore including Rs 3,200 crore claimed by financial creditors.
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