The National Company Law Appellate Tribunal (NCLAT) has backed Adani Ports & Special Economic Zones’ (subsidiary of Adani Group) strategies to take over the Dighi Port which is currently burdened by heavy debts.
An NCLAT bench consisting of three judges dismissed the petition filed by Vishal Vijay Kalantri, a promoter, who sought to go against the notice passed by the Mumbai bench of National Company Law Tribunal (NCLT), that allowed Adani Ports & Special Economic Zones’ (APSEZ) Rs 650-crore resolution plan on March 5, 2020
The appellate tribunal denied Kalantri's arguments stating that NCLT failed to take into consideration the oppositions raised by it following APSEZ’s resolution plan and denied the settlement proposal provided by his organization Balaji Infra Projects Ltd (BIPL).
"All objections raised qua the action of the 'Resolution Professional' during Corporate Insolvency Resolution Process (CIRP), approval of 'Resolution Plan' of 'APSEZ' by the Committee of Creditors and its subsequent approval by the Adjudicating Authority being unfounded are hereby repelled.”
"There is no merit in this appeal and the same is dismissed," observed the NCLAT bench led by Acting Chairperson Justice B L Bhat. The tribunal further noted that all "possible endeavors are made by the promoters to frustrate the CIRP and thwart all attempts at resolution of the corporate insolvency and revival of Dighi Port, thereby jeopardizing the legitimate interests of all stakeholders and defeating the object of the legislation.”
"At the very outset, we may observe that the instant case is yet another instance of the promoters not letting the goose escape from their dragnet, though it no more lays golden eggs," noted NCLAT.
Furthermore, it observed, “We say so as in the instant case this is the third attempt to stall the process, the earlier two efforts on the part of promoters having fizzled out.”
The NCLAT noted that all procedures were taken into consideration while allowing APSEZ's resolution plan.
"It is not disputed that the fair value and liquidation value was determined by the duly appointed registered valuers and the approved resolution plan was considered with regard to its viability and feasibility in terms of the provisions of the I&B Code' and CIRP Regulations. Nothing has been brought to our notice to demonstrate that the approved resolution plan of APSEZ' contravenes any provisions of law,” it noted in the July 24, 2020 order.
“This argument, in the nature of such settlement offer being superior to the approved Resolution Plan of 'APSEZ' in the context of a financial matrix, viability, and feasibility, cannot be accepted for the simple reason that the decision regarding feasibility and viability of a Resolution Plan qua the intended objective of I&B Code' is essentially a business decision resting upon commercial wisdom of the CoC and is not amenable to judicial review,” NCLAT said.
Dighi Port, in development by BIPL and promoted by Kalantri, is in a debt of over Rs 3,000 crore and undergoing corporate insolvency resolution process.
Kalantri had offered Rs 680 crore to the lenders, through BIPL, other than the Rs 50 crore towards the CIRP costs and payment to operational creditors. The offer was tabled in September 2019.
APSEZ’s plan was allowed by the Committee of Creditors with a high majority, over 99.68 percent votes, on September 19, 2019.