HNGI insolvency case: Supreme Court asks CoC to consider INSCO's plan

Should INSCO meet these conditions, the CoC shall consider its resolution plan for HNGI, and the plan is to be approved by both the creditors and the adjudicating authority by June 27

The Supreme Court has asked the Committee of Creditors (CoC) of Hindustan National Glass and Industries (HNGI) to consider the resolution plan of Independent Sugar Corporation (INSCO), provided the cash payment by INSCO to the CoC matches glass and sanitaryware maker AGI Greenpac’s commercial offering.

 

The apex court also said that the resolution plan submitted by INSCO will be considered only if the company “adheres to its original payment to the operational creditors and workmen of Rs 50 crore, and the equity to the CoC would remain.”

 

Should INCO fulfil these conditions, the CoC would consider its resolution plan for HNGI. And, the plan would be approved by both the creditors and the adjudicating authority by June 27.

 

 

INSCO’s plan involved Rs 1,850 crore to the financial creditors in addition to 5 per cent equity and Rs 50 crore to the operational creditors.

 

AGI Greenpac, in its plan, had offered Rs 2,207 crore to the financial creditors, Rs 6 crore to operational creditors, but no equity to the CoC.

 

 

IIn February this year, AGI Greenpac sought a review of the Supreme Court ruling that quashed the approval of its resolution plan for HNGI. It cited failure to obtain proper approval from the Competition Commission of India (CCI).

 

“On a standalone basis, there still was a view that it was a specific case and facts that were impacting specific parties. But, in light of the JSW order, that the process is supreme, now any aggrieved party, promoter or unsuccessful bidder may try and seek relief from courts to reject and reopen all past approved and implemented resolution plans, wherein CCI approval was obtained after the CoC approval,” a senior executive at a Big Four firm said.

 

 

The Ministry of Corporate Affairs (MCA) will likely amend the Insolvency and Bankruptcy Code (IBC) to reduce the burden on the CCI.

 

Sources said the ministry would clarify that prior permission of the CCI is not required for submitting bids under the corporate insolvency resolution process (CIRP).

 

The Supreme Court has also agreed to hear the review petition filed by the antitrust watchdog on the practical difficulties in implementing its order.