NCLT rejects Torrents’s plea for Hinduja’s resolution plan approval, set to hear it on September 26.

On Wednesday, 13th September 2023, a quasi-judicial body rejected the plea of Torrent Group. This rejection will be beneficial for Reliance Capital and the next hearing of this case will be on 26th September 2023. According to the reports, Torrent Group was looking for the delay in the approval of the resolution plan of Reliance Capital but now the National Company Law Tribunal (NCLT) has lashed all hopes to the group and it will be interesting to watch what will be the next plan of Torrent Group in this matter and how they will handle it. Besides this, there are several people who want to know what the exact matter is and why NCLT rejected the plea. 

The reports said that the Hinduja Group firm, Indusland International Holding Ltd (IIHL) has submitted the plea for Reliance Capital. The Indian diversified financial services is currently drowning in debt and the Hinduja Group firm brought up a resolution plan. But, Torrent Group was against it and wanted to delay the approval till the Supreme Court passed a final order and that is why the firm has requested the NCLT to delay the approval submitted by Hinduja Group. Now, it is believed that after the rejection of NCLT on the plea of Torrent Group, the decision could speed up the process of the resolution plan of Hinduja Group for Reliance Capital. 

Earlier this year, IIHL came forward as the only bidder for turning around Reliance Capital, after the moneylenders finished the extended challenge process. The quasi-judicial body must now approve the resolution plan of Hindujas to finish the entire press that lies under the code “Insolvency and Bankruptcy Code. Speaking about the plea Torrent, the company was looking for the intervention of the tribunal to put a hold on the resolution plan of RCap in suspension till the final order of the Supreme Court. Torrent Group has also requested the Mumbai bench of NCLT to direct the committee of creditors, Hinduja Group-owned Indusland International Holdings, and the administration of Reliance Capital not to take any action on finishing the resolution process. 

The NCLT bench comprising justices Prabhat Kumar and Virendra Singh Bisht said “With respect to the apex court’s order of March, it is an undisputed fact that the applicant (Torrent) has not participated in the extended challenge mechanism nor has it submitted a resolution plan.” The NCLT clearly cited that the Supreme Court had not issued a stay on proceedings. Moreover, it also came to notice that the current delay on the resolution plan was causing weekly losses of around Rs 42 crore to the moneylenders of Reliance Capital. 

The Mumbai bench said that it was right to hear the resolution plan application in spite of the objections raised by Torrent Investments. NCLT also mentioned that the Supreme Court had reserved the right of parties on 20th March 2023 to join in a Swiss Challenge process. Still, Torrent did not come to show its participation in this extended process nor submit the application for a resolution plan. As per the previous reports, the Corporate Insolvency Resolution Process (CIRP) against Reliance Capital was started on the 29th of November 2021. Reliance Capital has a compressed debt of around Rs 40,000 crore. Now, NCLT will hear the resolution plan on 26th September 2023. 

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