No deviation in process, says RCap lender to NCLAT

NEW DELHI: Lenders of Reliance Capital on Friday submitted before the insolvency appellate tribunal NCLAT that there was no deviation from procedures in the ‘challenge mechanism’ adopted by them for the resolution of Reliance Capital case.

The efforts were towards maximisation of assets and it is for the lenders to decide the value, submitted senior advocate Kapil Sibal representing Vistra ITCL (India) Ltd, one of the lenders of Reliance Capital.

The adjudicating authority (NCLT) can not restrain the Committee of Creditors (CoC) from exercising their commercial wisdom, he said.

“Ultimately we (CoC) have to decide the value,” Sibal said, adding in this case, lenders decided not to cancel the bid after finding it suboptimal but to go for the “challenge mechanism”.

Sibal further submitted that the National Company Law Tribunal (NCLT) can not decide the value.

Hinduja group firm Indusind International Holdings Ltd (IIHL) has also approached the National Company Law Appellate Tribunal (NCLAT), supporting the lenders.

The appellate tribunal listed the matter on Monday for further hearing after Vistra ITCL concluded its argument. Now the administrator of RCap, IIHL and others respondents would start their argument.

In its petition, IIHL said it sees no bar in multiple rounds of ‘challenge mechanism’, to discover the highest value.

IIHL’s appeal was heard by NCLAT along with the plea of lenders.

It submitted that the Adjudicating Authority (NCLT) has committed a grave “jurisdictional error” in entertaining an application which seeks to interdict an ongoing Resolution Process being carried out by CoC at the behest of a resolution applicant (Torrent).”