National Company Law Tribunal (NCLT) President M M Kumar has referred a case related to the insolvency of Era Infrastructure
to a larger Bench, according to sources.
On September 22, this Bench will decide whether the NCLT
can take up the insolvency petition against Era Infra when several winding-up cases are being heard by the high court in Delhi.
The New Delhi NCLT’s two-member bench, hearing Union Bank’s plea seeking commencement of insolvency process against Era Infra, had earlier said that Kumar would take a call.
Article 227 of the Constitution says that the high court of a state shall have supervisory jurisdiction over all courts and tribunals within its area of influence.
However, the Union Bank’s counsel has been insisting that the case can be admitted by the NCLT
as all creditors involved in the winding-up petitions could then stake their claims over Era Infra's assets if the case came up under the Insolvency and Bankruptcy Code
The bank highlighted orders from other benches of the NCLT, according to which insolvency proceedings were initiated in similar circumstances.
Era Infra's lawyers also said that the tribunal was entitled to entertain the bank’s insolvency plea and contended that rules — issued under the Companies
Act, 2013, to transfer pending winding-up petitions — did not come in the way of the insolvency proceedings. In support of this statement, they highlighted the intention of the IBC
to amalgamate all company and insolvency matters into one forum for adjudication.
The liability claimed by Union Bank
till end of March 2017 is to the tune of Rs 681.04 crore, along with an overdue external commercial borrowing of $11.97 million.
Era Infra had contested the amount and a final decision on the matter would be taken by insolvency professionals.
Era Infra Engineering owes over Rs 10,000 crore to its creditors. Over and above this, there are statutory dues, some of which are under litigation.