Insolvency proceeding: Gujarat High Court dismisses Essar Steel plea against RBI directive

Gujarat High Court dismisses Essar Steel's plea challenging RBI order on bankruptcy

Gujarat High Court dismisses Essar Steel's plea challenging RBI order on bankruptcy

The Gujarat High Court on Monday disposed of the petition moved by Essar Steel challenging the insolvency proceeding against it by Reserve Bank of India without granting any relief to the company.

With the latest order, the interim stay granted on the proceedings against Essar Steel under the NCLT stands vacated and insolvency proceedings under the NCLT can, hence, be resumed by the lenders led by State Bank of India (SBI).

Earlier this year, the RBI had identified top 12 NPA accounts, including of Essar Steel, for bankruptcy proceedings.

As per the latest development, the High Court dismissed the plea by Essar Steel against bankruptcy proceedings initiated by its lenders at the National Company Law Tribunal (NCLT).

The Gujarat High Court's order clears the way for no further challenges by any of the companies going to insolvency courts on the grounds made by Essar Steel.

The RBI later issued a corrigendum to the press release and deleted the statement. Standard Chartered Bank had also moved the NCLT against Esaar.

The company claimed that unilateral action was being initiated when it was in a restructuring mode and objected that it was being clubbed with the other 11 major defaulting firms.

The company was challenging the RBI's directive, not the SBI's decision.

The RBI's counsel disputed both points stating that it was not true that the company was discussing restructuring of repayments with banks, while insolvency proceedings would in fact help the company to shape up and not close it down.

The action was a violation of his client's fundamental right to equality before the law and equal protection of the law under Article 14 of Constitution, he said. "This court is being misled", he had said during the arguments. "The company was aware about SBI's action". This goes up to Rs 10 lakh crore when those of private and other lenders are added on. Meanwhile, bankruptcy proceedings have also been filed on Essar Steel Ltd and Monnet Ispat and Energy Ltd.

RBI's criteria for selecting the dozen defaulters was that each of them owed at least ₹5,000 crore to banks and 60% of it had turned non-performing by 31 March 2016.

Notícias recomendadas

  • Pyrénées : un minibus chute dans un ravin avec sept enfants à bord

    Pyrénées : un minibus chute dans un ravin avec sept enfants à bord

    Une famille revenait d'une journée de pèlerinage à Lourdes lorsque leur véhicule a quitté la route. . Cette grande famille originaire de l'Indre-et-Loire passait ses vacances à Cauterets depuis 15 jours.
    Ludovic Chancel : les causes de sa mort révélées

    Ludovic Chancel : les causes de sa mort révélées

    Comment expliquer l'inexplicable? Dans la nuit du 7 au 8 juillet dernier, Ludovic Chancel nous a quitté . Il y a quelques jours, l'une des amies de Ludovic Chancel assurait qu'il ne s'agissait pas d'un suicide.
    Macron calls for new Israel-Palestine talks during Netanyahu's visit

    Macron calls for new Israel-Palestine talks during Netanyahu's visit

    Macron insisted that "it was indeed France that organised this". "Your struggle against militants Islam is our struggle", he said. He said "not a single German" was directly involved, but instead blamed French police collaborating with the occupying Nazis.
  • British royals awaited in Poland at start of a European Union  visit

    British royals awaited in Poland at start of a European Union visit

    The Duchess and Duke and Cambridge, Polish President Andrzej Duda and his wife at the presidential palace in Warsaw. William and Kate also celebrated the 70th birthday of Camilla, the Duchess of Cornwall, over the weekend.
    Arsenal star set for £30m move to Premier League rivals

    Arsenal star set for £30m move to Premier League rivals

    But it seems that Ronald Koeman has yet more reinforcements he's planning to sign before the end of the transfer window. No such declarations have been forthcoming about Walcott, giving Everton hope that they may yet add a marquee signing.

    Mosaic Company (The) (MOS) Upgraded at BidaskClub

    The share price of Mosaic Company (The ) (NYSE:MOS) was down -0.55% during the last trading session, with a day high of 23.96. Stock market analysts and brokers have recently amended their target prices on shares of Mosaic Company (The ) (NYSE: MOS ).
  • Bottas perfects strategy, gets lucky in charge to P2 at Silverstone

    Vettel and Verstappen were scrapping on and off the track in a fight for third, giving the packed crowd several thrilling moments. His Ferrari team-mate Kimi Raikkonen , who spun off the circuit during the second session, ended the day third in the order.
    Martin Landau Dead at 89

    Martin Landau Dead at 89

    The veteran actor rose to prominence after playing a homosexual henchman in Alfred Hitchcock's 1959 film " North by Northwest ". Landau said he found himself adrift, reduced to playing heavies in low-budget dreck. "I think he enjoyed the challenge".
    Russian pair enjoy Wimbledon final whitewash

    Russian pair enjoy Wimbledon final whitewash

    The second seeded Russian combine on Saturday eased to a 6-0, 6-0 mauling of the ninth seeded Taiwan-Romanian pair. It was Makarova and Vesnina's second attempt at the Wimbledon doubles title.
  • United States  to Give Back Russia's Diplomatic Compounds Only For 'Something in Return'

    United States to Give Back Russia's Diplomatic Compounds Only For 'Something in Return'

    The public objection was rare for Netanyahu, who has sought to avoid confrontation with Moscow and Washington over Syria.
    2,1 milliards de personnes n'ont pas accès à l'eau potable à domicile

    2,1 milliards de personnes n'ont pas accès à l'eau potable à domicile

    Selon le responsable de l'eau, de l'assainissement et des mesures d'hygiène à l'OMS Bruce Gordon, près de 850'000 personnes se retrouvent ainsi exposées à des maladies diarrhéiques.
    Two Iranians Killed in Border Attack

    Two Iranians Killed in Border Attack

    President Hassan Rouhani wrote to Prime Minister Nawaz Sharif calling for greater efforts to prevent insurgent attacks along the border.

We are pleased to provide this opportunity to share information, experiences and observations about what's in the news.
Some of the comments may be reprinted elsewhere in the site or in the newspaper.
Thank you for taking the time to offer your thoughts.