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Binani Industries, the parent company of Binani Cement, withdrew its appeal against an NCLAT order today in the Supreme Court after the court refused to allow out of court settlement for Binani Cement.
Senior Advocate Harish Salve appeared and argued for Binani before a Bench of Justices AK Goel and Rohinton Nariman before he chose to withdraw the appeal.
Salve’s argument was that there was nothing in the Insolvency and Bankruptcy Code, 2016, which prevented Binani from entering a settlement and securing itself.
“If I want to secure myself and I am willing to pay everything off, then there is nothing in the statute which prevents me“, said Salve.
However, Justice Rohinton Nariman, observed,
“Why should we interfere at this stage? Binani plea appears to be “put up” by Ultratech, the failed bidder.”
Senior Advocates Kapil Sibal and Abhishek Manu Singhvi along with Advocate Mahesh Agarwal appeared for Ultratech. It was argued that there were no grounds to disqualify Ultratech from making the offer.
The Court seemed unimpressed, whereupon Salve offered to withdraw the appeal.
Binani Cements has been facing insolvency proceedings since July, 2017. Among the top two contenders for Binani Cements, were Rajputana Properties (a wholly owned subsidiary of Dalmia Bharat) and UltraTech Cement.
Between the two, the creditors’ committee selected Rajputana as the winning bidder. Aggrieved with this decision, UltraTech opposed this move in the NCLT for ‘lack of transparency’ in the process.
UltraTech, however, revised its bid to clear off the entire debt of Binani Cements, but with little luck.
Binani Industries then tied hands with UltraTech to a form a structure where Binani Industries would clear off the entire debt of its subsidiary. This deal was proposed to be executed outside the IBC regime, since it was the promoters who were clearing off the debt and not a resolution applicant.
While the NCLT suggested an out of court settlement between all the parties, the NCLAT said that the NCLT should go ahead with resolution process requirements unaffected by its order suggesting out of court settlement. This order was appealed by Binani Industries at the Supreme Court, which was withdrawn today.