Construction workers carry buckets of soil on their heads at a work site just off of Marine Drive in Mumbai, India. (Photographer: Scott Eells/Bloomberg)

ICICI Bank’s Insolvency Plea May Not Be Admitted By NCLT, Says Punj Lloyd

Engineering and construction firm Punj Lloyd Ltd. today expressed hope that the insolvency plea against the company by ICICI Bank Ltd. would not be admitted by the National Company Law Tribunal.

According to the company, 90 percent of its lenders support a resolution plan under the leadership of the State Bank of India Ltd. for restructuring the outstanding debts of the company. Lenders met on June 13.

During NCLT proceedings today, the counsel for SBI challenged the maintainability of ICICI Bank’s plea filed under the Insolvency and Bankruptcy Code to initiate insolvency proceedings against the company, Punj Lloyd said in a regulatory filing.

“The company is of the view that the application filed by ICICI Bank may not be admitted by the NCLT, since more than 90 percent of the lenders of the company are in favour of restructuring the debts,” said Punj Lloyd.

In a meeting of the lenders of the company held on June 13, it was decided that “SBI, on behalf of all lenders, shall oppose ICICI application at NCLT,” the filing informed.

ICICI Bank’s plea was heard today by the principal bench of NCLT headed by President Justice MM Kumar, which issued notices to Punj Lloyd and SBI. The two-member bench has directed the matter to be listed next on July 24.

However, during the proceedings, another consortium of lenders led by SBI, opposed the insolvency application filed by ICICI Bank.

According to them, Punj Lloyd’s asset base covers only 5 percent of the total debt and a full recovery of their outstanding dues is possible only if the company is allowed to complete the 28 ongoing projects.

Punj Lloyd has total debt of around Rs 6,000 crore, out of which ICICI Bank claims are around Rs 850 crore.