Binani creditors' forum seeks audit of insolvency resolution process

The Binani Operational Creditors Forum (BOCF) on Sunday said it had sought a forensic audit of the insolvency resolution process of debt-ridden Binani Cement due to an alleged lack of transparency and step motherly treatment to micro, small and medium enterprise (MSME) players. The forum has filed a petition in the Supreme Court calling for a forensic audit of the process. The petition will come up for hearing on April 19.

Binani Cement owes about Rs 70 billion to financial and operational creditors. Though Dalmia Bharat, with its offer of Rs 63.5 billion, had been voted as the highest bidder by lenders, things took a turn when Binani Industries approached UltraTech to buy out its stake in Binani Cement for Rs 76.18 billion, involving 100 per cent payout to both secured and unsecured lenders. The BOCF is expecting the SC to grant a stay on the insolvency process and protect over 3,000 OCs.

“In Binani’s case, maximum number of petitions have been filed by OCs, as the resolution professional (RP) is disrespecting the law by subverting the claims of the OCs and misusing the judicial powers granted by the government,” BOCF spokesperson Rajesh Tibrewal said.

The OCs have alleged that the RP has connived with the bidder by sharing exclusive information, driving down the value of the asset. “We demand a forensic audit,” Sandeep Samdani, another spokesperson of BOCF, said. According to BOCF, the total exposure of OCs is Rs 7 billion and they are expected to get only Rs 1.51 billion if the bid from Dalmia Bharat goes through.

Meanwhile, a section of OCs are planning to plead before the Kolkata Bench of the NCLT for rebidding. The hearing is scheduled on Monday.

"Now, the only hope for the OCs is for the NCLT to declare a fresh bidding so that the interests of all stakeholders are protected. We will plead for it," spokesperson of OCs forum Hitesh Bindal said.