NCLAT asks Bhushan Power creditors to consider Liberty House bid

The National Company Law Appellate Tribunal (NCLAT) today asked the creditors of debt-laden Bhushan Power and Steel Ltd, which is facing insolvency proceedings, to consider the bid submitted by UK-based Liberty House.

Tata Steel, a BPSL bidder said to be leading the race, had yesterday moved the plea challenging the NCLT (National Company Law Tribunal) ruling allowing the Committee of Creditors (CoC) to consider the resolution plan submitted by Liberty House.

The two member bench of the appellate tribunal, headed by Chairman Justice S J Mukhopadhaya, also directed the CoC not to disclose its outcome till May 24, the next date of hearing.

The CoC, it added, must support with a reason as to why it has selected or rejected the plan.

Tata Steel has challenged the April 23, 2018 order, passed by NCLT, which asked the BPSL lenders led by Punjab National Bank to consider the bid submitted by Liberty House.

Tata Steel was believed to be the highest bidder for BPSL. The CoC had not accepted the bid of Liberty House on account of late submission.

This was challenged by Liberty House before NCLT, which had allowed the plea and directed the CoC to complete its resolution proceedings by June 23.

A two-member NCLT bench, headed by President Justice M M Kumar had said that Liberty House bid cannot be disqualified only on the ground of being submitted after the deadline of the resolution professional (RP).

"We hope that CoC takes an appropriate commercial decision as per the Insolvency and Bankruptcy Code (IBC)," NCLT had said.

The CoC had in February rejected the Liberty House bid leaving Tata Steel and JSW Steel in the race for taking over the assets of the bankrupt firm.

Liberty House had submitted before the NCLT that RP rejected its bid to acquire BPSL without even opening the seal of its offer.

BPSL was among the 12 non-performing assets the Reserve Bank had referred for insolvency proceedings in June last year. The company owes about Rs 45,000 crore to its lenders.