Binani Industries steps up pleas against its cement unit resolution

Binani Industries will be moving a contempt application against the resolution professional (RP) and his assistant in the Delhi Bench of the National Company Law Appellate Tribunal (NCLAT), alleging non-compliance to a court order. It will also submit a separate plea against the committee of creditors (CoC) in the Kolkata Bench of the National Company Law Tribunal (NCLT).

Sources told Business Standard that initially, the directors of Binani Cement had moved the Kolkata Bench of the NCLT, alleging vested interest of the RP in evaluating the assets of Binani Cement. They moved the Delhi Bench of NCLT with a similar application due to delays at the Kolkata Bench.

“The Delhi Bench had ordered the RP to disclose details of the evaluation and resolution process. The RP did not comply with the order. Hence, a contempt petition is being moved at the Delhi NCLT,” the source said.

Sources also alleged that at Wednesday’s CoC meeting, the representative of Binani Cement, Visalakshi Sridhar, was asked to go out before voting began on the proposal put forward jointly by Dalmia Bharat Cement and Bain Capital’s Resurgent India Fund.

Later, Sridhar, via an email to the RP, claimed that the outcome of the meeting should be recalled as it was against the verdict of the NCLT.

It has been contended that, according to the law, the authorised representative of the suspended board should be entitled to enter the meetings only after the end of discussions on any first two agendas of a meeting, which has been denied.

Vijay Kumar V Iyer and Sumit Khanna, both associated with Deloitte India, are the RP and the assistant RP, respectively.

The source added that Braj Bhushandas Binani, director at Binani Cement, may file a fresh petition against the CoC for accepting the resolution plan of Dalmia Bharat Cement, which is alleged to be undervalued.

It has been claimed that the CoC had valued the assets of Binani Cement at over Rs 150 billion during the pendency of the insolvency resolution process, which the CoC, in connivance with the RP, decreased to less than Rs 30 billion. The Kolkata Bench of the NCLT is likely to come up with a verdict on the issue on Monday.

A second source said these proceedings were not likely to affect the resolution plan that has received the CoC’s approval and will be submitted to the NCLT for the final approval, adding that Bharat Dalmia Cement is ready with the upfront payment to be made to the lenders of Binani Cement. The Bank of Baroda had dragged Binani Cement to the NCLT in July 2017after it failed to repay a loan of over Rs 0.97 billion.