The Adani Power Proposal For Korba West Power Was Upheld By NCLAT
An arbitration was being held for claims of Rs 45.22 crore made by Shapoorji Pallonji & Company. Nevertheless, under section 10 of the Insolvency and Bankruptcy Act, Korba West Power has initiated the Corporate Insolvency Resolution Process on its own.
Adani Power's bid for Korba West Power's 2019 Resolution Plan was upheld by the National Company Law Appellate Tribunal (NCLAT), which also ordered Shapoorji Pallonji & Company to initiate arbitration procedures for any unresolved issues.
"There is no illegality in the decision approving the resolution plan by the adjudicating authority (NCLT) and it does not perceive any basis to set apart the resolution plan by Adani Power Ltd.," a two-member NCLAT court said. The Ahmedabad Bench of the National Company Law Tribunal (NCLT) issued a ruling on June 24, 2019, sanctifying the resolution plan by Adani Power. Shapoorji Pallonji & Company appealed that decision.
An arbitration was being held for claims of Rs 45.22 crore made by Shapoorji Pallonji & Company. Nevertheless, under section 10 of the Insolvency and Bankruptcy Act, Korba West Power has initiated the Corporate Insolvency Resolution Process on its own. After this, the corporation was placed under a moratorium, and the aforementioned arbitration procedures were halted. Eventually, Shapoorji Pallonji & Co. claimed the money during the CIRP as an operating creditor. Nevertheless, the resolution specialist denied the aforementioned allegation, and NCLT authorized the Adani Power proposal.
Shapoorji Pallonji & Co. claimed that no written notice of its rejection had been given, but RP had responded that it was only required to do so if the total amount owed to the "Operational Creditors" exceeded 10% of the "debt" of the "Corporate Debtor".
