NCLT Orders Insolvency Proceedings Against Vadraj Cement
(MENAFN- Live Mint) "Mumbai: The Mumbai bench of the insolvency tribunal has ordered initiation of insolvency proceedings against Vadraj Cement, a group company of the bankrupt ABG Shipyard, after the cement manufacturer defaulted on dues of more than ₹87 crore to state-run Punjab National bank (PNB).“Considering the facts and law, this bench is of the view that in such circumstances, it is imperative that corporate insolvency resolution process (CIRP) is only to be initiated in respect of the corporate debtor (Vadraj Cement). The default of the corporate debtor has been established and the application filed under Section 7 of the Insolvency and Bankruptcy Code (IBC) deserves to be admitted,” a National Company Law Tribunal (NCLT) bench led by justices K.R. Saji Kumar and Sanjiv Dutt said in an order on 3 February bench appointed Pulkit Gupta, a partner at EY (debt and special situations) as the interim resolution professional who will manage the day-to day affairs of the company. In November, the Economic Times reported that Adani Group, JSW Cement and ArcelorMittal were in running to buy the bankrupt Gujarat-based firm, one of its creditors, had filed an application under the IBC to initiate insolvency proceedings against the cement company for defaulting on its dues bank told the tribunal that despite repeated requests, the company failed to repay its dues. Following the default, the bank filed an insolvency application in September 2018, almost a year after its loan to the company was classified as a non-performing asset (NPA) in December 2017 August 2018, the Bombay High Court ordered Vadraj Cement to be wound up after trade creditor Beumer Technologies India dragged it to court to recover dues. The court, however, recalled the winding-up order and instead transferred the matter to the NCLT bench company's total debt stands at ₹7,000 crore, according to the ET report cited earlier, and lenders include government-owned banks like Union Bank of India, Central Bank of India, Indian Overseas Bank, Bank of India, and Bank of Baroda, besides PNB Shipyard was one of the 12 largest non-performing accounts that RBI had, in 2017, asked banks to initiate insolvency proceedings against. Essar Steel, Jaypee Infratech, Bhushan Power & Steel, Amtek Auto, and Alok Industries were the other big names on the list Punjab National Bank was represented by Prakash Shinde and Ruchita Jain of law firm MDP Partners, Vadraj was represented by advocate Suyash Shanker.
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