The National Company Law Tribunal today approved Tata Steel Ltd.’s bid for the debt-ridden Bhushan Steel Ltd. It dismissed a plea filed by troubled steelmaker’s employees who opposed the bid and imposed a fine of Rs 1 lakh on them.
The bench comprising NCLT President Justice M M Kumar and S K Mohapatra also dismissed Larsen & Toubro Ltd.’s plea seeking higher priority in recovery of loans and imposed a Rs 1 lakh fine on the engineering and construction major. This comes after L&T, an operational creditor of Bhushan Steel, had sought higher priority in recovery of debt in the resolution process on a par with financial creditors or lenders.
The tribunal also rejected Bhushan Energy’s plea to continue its power purchase agreement with Bhushan Steel. The order was pronounced in court today and a detailed judgement is awaited.
On April 11, the principal bench of the tribunal had reserved its order after hearing all the sides. The Committee of Creditors had approved Rs 32,500 crore deal along with 12.27 percent equity in Bhushan Steel offered by Tata Steel.
However, some employees of Bhushan Steel had challenged it before the NCLT contending that Tata Steel was not eligible under section 29 (A) of the Insolvency and Bankruptcy Code.