Lenders of Jaiprakash Associates Ltd (JAL) have rejected the modified one-time settlement proposal submitted by the debt-ridden group. The NCLAT will now proceed with the insolvency proceedings.
New Delhi, Jul 3 (PTI) Lenders of Jaiprakash Associates Ltd (JAL) led by ICICI Bank on Wednesday rejected the modified one-time settlement proposal, in which the debt-ridden group had offered a higher upfront payment and sales of its cement assets.
During a hearing before the insolvency appellate tribunal NCLAT, senior advocate Sajeev Sen representing ICICI Bank informed the bench about the rejection of the OTS (one-time settlement) scheme by the lenders.
"The OTS proposal has been rejected by the lenders," said Sen urging the National Company Law Appellate Tribunal (NCLAT) to proceed further in the matter over the merit.
The NCLAT was hearing a petition filed by Sunil Kumar Sharma, a member of the suspended board of JAL, challenging an order of the Allahabad bench of the National Company Law Tribunal (NCLT).
On June 3 this year, the Allahabad bench of NCLT admitted the six-year-old petition filed by ICICI Bank in September 2018 and appointed Bhuvan Madan as the interim resolution professional, suspending the board of JAL.
After a brief hearing on Wednesday, a three-member NCLAT bench which also comprised Chairperson Justice Ashok Bhushan, directed listing of the matter on July 26 for the next hearing.
On June 11 a vacation bench of the appellate tribunal had asked the consortium of lenders to consider the OTS submitted by JAL before the NCLT.
During the last hearing, JAL had submitted that the company is inclined to make the entire payment within 18 weeks if the OTS is accepted by the bank.
In its earlier settlement proposal filed before NCLT, JAL had offered an upfront payment of Rs 200 crore and the balance of about Rs 16,000 crore to be paid on or before 18 weeks from its acceptance.
However, this was dismissed by the Allahabad bench of the NCLT which ordered the Corporate Insolvency Resolution Process (CIRP) against JAL.
In its order, a two-member vacation bench of the NCLAT said that the JAL may also consider a deposit of some bigger amount by the next date of hearing.
Following that JAL increased the upfront payment to Rs 500 crore.
It had proposed an additional deposit of Rs 300 crore besides the Rs 200 crore already furnished.
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