In June, the Hyderabad bench of the NCLT rejected a lender-approved plan, stating that the performance bank guarantee furnished by the successful resolution applicant, Anirudh Agro Farm, had expired. In August, the same bench warned that the resolution professional might face consequences for not implementing its June order to restart the sale process.
Rejecting the plan on June 9, the NCLT order had elaborated that the bank guarantee issued by Kotak Mahindra Bank was valid for six months beginning November 11, 2022, and thus expired on May 10, 2023. It observed that since the payment was to be done over 675 days, the guarantee should cover the implementation schedule.
However, the National Company Law Appellate Tribunal set aside the order, stating that the performance bank guarantee, issued by Kotak Mahindra Bank, was subject to periodic extensions and renewal. Citing a memo dated October 5, the appellate body said the bank had confirmed that the guarantee issued by it shall be valid and binding on the bank guarantor.
The company’s committee of creditors had, with 95.8% of the voting share, approved the ‘151 crore debt resolution plan. The plan has proposed ‘150 crore to the financial creditors.
The resolution professional had admitted ‘768 crore of claims. State Bank of India, Canara Bank, Union Bank, Asset Reconstruction Company (India) and Edelweiss Asset Reconstruction Company are among the lenders.