The Supreme Court on Friday set aside the July 4 order of the NCLAT approving ArcelorMittal's Rs 42,000-crore bid for acquiring debt-laden Essar Steel.
A bench headed by Justice R F Nariman quashed the National Company Law Appellate Tribunal (NCLAT) order which had given financial creditors equal status with operational creditors in the distribution of ArcelorMittal's bid amount.
The apex court relaxed timeline of 330 days to find a resolution of the stressed asset as prescribed in IBC. "Open to NCLAT to extend the timeline of required," said the court.
While pronouncing the order, the court said appeals of Committee of Creditors (CoC) will be allowed and the resolution plan of Arcelor Mittal as amended by CoC must be accepted for Corporate Insolvency Resolution Process (CIRP).
The bench clarified that financial creditors enjoy primacy and the adjudicating authority cannot interfere with the decision approved by the committee of creditors.