By rejecting a petition filed by the Torrent Group, the Supreme Court on Monday it refused to stay an order from the National Company Law Appeals Tribunal (NCLAT) allowing a second electronic auction for debt-laden companies to be held. trust capital (RC Cap).
The measure allows RCap's creditors' committee (CoC) to proceed with its plans to invite expressions of interest from resolution applicants and maintain the proposed expanded challenge mechanism. However, the outcome of the auction will depend on the final order of the high court, with the matter listed for hearing again in August.
The court consisting of judges Sanjiv Khanna and MM Sundresh did not approve any orders. The CoC is likely to meet later on Monday to finalize the date for the expanded challenge mechanism, now scheduled for March 29. Previously, the lenders had decided to hold the electronic auction on the same Monday, but decided to wait until the higher court makes its order.
Lead lawyer Mukul Rohatgi appeared on behalf of Torrent Investments, a group company through which the Gujarat-based Torrent Group had made its offer for all of RCap's assets. Earlier this month, Torrent Group moved to the Supreme Court against NCLATThe order that allowed an extended auction to be held for the debt-laden company. Vistra ITCL (India), a member of the CoC, was the defendant in the case.
The appeals court had allowed the second electronic auction to take place, allowing the lenders' request to "maximize the value" of the debt-laden company, as the bids received were "suboptimal and unsatisfactory."
On March 2, NCLAT revoked the National Company Law Tribunal's order that had allowed a second electronic auction. The appeals court had also told the CoC to take steps to continue negotiations with the settlement applicants under the relevant clauses of the settlement plan. The order allowed the CoC to negotiate and request higher bids.
In February, NCLT's Mumbai bank had declared the second proposed electronic auction a breach of bankruptcy rules. In addition, the bankruptcy court also rated Torrent Group as the highest bidder under the first challenge mechanism and ordered the trustee to bring the process to its "logical conclusion."
