Torrent Investments, at the NCLT hearing on Thursday, argued that the minutes of the December 23 CoC (creditors' committee) meetings reflect that the CoC had recorded that the revised offer submitted by Hinduja Group was not compliant.
Darius Khambata, speaking on Torrent's behalf, said the minutes show the trustee had gone on record that Hinduja's revised bid was deficient and that it would be unfair to Torrent to give Hinduja another chance to bid.
As such, no comment was made on the breach of Torrent's offer, he said, adding that the same is a new argument now being used by the CoC.
The CoC noted that Hinduja's offer had not been submitted in accordance with the Challenge mechanism, while Torrent's offer had been approved, subject to NPV (net present value) verification, it said, adding that the administrator had stated then that it would be unfair to ask Torrent to revise its offer to comply with the rules of the mechanism.
Torrent Investments had emerged as the highest bidder after the first round of the auction, with the highest NPV bid of ₹8,640 crore. However, a day later, the only other bidder, the Hinduja Group, revised its proposal to outbid Torrent Investments. The latter brought Reliance Capital to NCLT, claiming that Hinduja's revised offer should not be considered and that going to a second auction would be illegal and against the spirit of IBC.
NCLT adjourned the hearing until Friday and said it will also make a decision on extending the second round of auction, currently scheduled to take place on Monday.
Harish Salve argued on Hinduja's behalf, saying that the final decision on the bids and the commercial value of the assets rests with the CoC and if they find Hinduja's offer to be non-compliant, it could also be rejected. Mahesh Agarwal said Torrent's offer was misleading as the CoC's calculated NPV was Rs 8,142 crore, lower than the stated NPV of Rs 8,640 crore.
In response, Khambata said that Torrent's problem was not the CoC's discretion over bids, but rather following the process of the challenge mechanism. He added that the NPV presented by Torrent was according to the calculation methodology defined by the CoC, which is why the minutes reflect that the offer had been accepted by the CoC.
