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Essar Steel Case: GAIL, GETCO Move NCLT Against ArcelorMittal Bid

By LawStreet News Network      20 November, 2018 12:00 AM      0 Comments
Essar Steel Case: GAIL, GETCO Move NCLT Against ArcelorMittal Bid

GAIL (India) and Gujarat Energy Transmission Corp (GETCO) have moved to National Company Law Tribunal (NCLT) Ahmedabad bench seeking rejection of ArcelorMittal’s ₹42000 crore bid for Essar Steel, saying operational creditors have been left out in the proposal.

In separate interlocutory applications, GAIL and GETCO claimed that they have outstanding dues of over ₹1,800 crore against Essar Steel India, which are not being fully cleared by ArcelorMittal.

The petition filed by GAIL states that "the resolution plan submitted is in contravention of Section 30 (2) of Insolvency and Bankruptcy Code (IBC) 2016. That even otherwise resolution plan is neither legal nor proper in the interest of all creditors. The resolution plan is arbitrary, irrational, illogical that puts in jeopardy the interest of operational creditors and completely fails to protect the interest of operational creditors."

Last month, Essar Steel's Committee of Creditors (CoC) had approved the ArcelorMittal’s resolution plan, which offered to pay ₹42,000 crore of the total dues of ₹49,395 crore to the financial creditors. However, the operational creditors, under the plan, are to get just ₹214 crore against the outstanding of ₹4,976 crore.

While GAIL has claims of ₹907 crore against Essar Steel, GETCO has outstanding dues of ₹896.52 crore.

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