NCLT lets insolvency proceedings against debt-ridden Essar Power Jharkhand

The National Company Law Tribunal (NCLT) has allowed insolvency proceedings against debt-ridden Essar Power Jharkhand Ltd (EPJL).

The decision has come on a plea filed by the company's lender ICICI Bank.

The principal bench of NCLT has appointed an interim resolution professional (IRP) to manage the affairs of the company, according to an order.

Under the Insolvency and Bankruptcy Code (IBC), the tribunal has also imposed various restrictions on EPJL, including ban on transfer, alienate or dispose of the property.

"We are satisfied that a default has occurred and the application under section 7(2) is complete and no disciplinary proceedings are pending against the proposed IRP. Thus the application warrants admission," said NCLT bench headed by President Justice M M Kumar.

"As a sequel to the above discussion, this petition is admitted and Huzefa Fakhri Sitabkhan is admitted as IRP," it said in an order dated April 5.

A copy of the judgement has now been uploaded on the NCLT website.

The tribunal has directed the IRP to make a public announcement regarding admission of the insolvency plea against EPJL immediately.

According to ICICI Bank, the total amount in default was Rs 3,468.29 crore as on December 15, 2017.

NCLT said all the personnel connected with EPJL or its promoters or any other person associated with the management are under legal obligation to extend every assistance and cooperation to IRP as may be required by him while managing the affairs of the company.

"In case there is any violation by EPJL's ex-management or ex-directors, IRP would be at liberty to make appropriate application to this tribunal with a prayer for passing an appropriate order," the tribunal said in the order.