Gujarat HC turns down Essar Steel plea against RBI's insolvency proceedings HC turns down Essar Steel plea on insolvency, raps central bank for 'overstepping jurisdiction'
The Gujarat High Court on Monday disposed of Essar Steel’s petition against insolvency proceedings initiated by its lenders after a directive by the Reserve Bank of India (RBI).
This is likely to smoothen the insolvency proceedings against Essar as well as the 11 other non-performing accounts identified by the RBI. The four other steel companies on the list, however, have already said they would cooperate with lenders and not move court to stall proceedings.
On July 4, Essar Steel, promoted by the Ruias, had filed a petition against the insolvency proceedings initiated against it at the National Company Law Tribunal (NCLT). Commenting on the court’s observations that the NCLT will have to decide on its own whether the insolvency petition is required to be entertained or not, Essar Steel stated in an official communiqué, “We respect the decision… (of the court) and will accordingly be raising these issues for consideration by the NCLT.”
The Ahmedabad bench of the NCLT is likely to take up insolvency proceedings against Essar Steel, initiated by a consortium of 22 banks led by the State Bank of India as well as Standard Chartered Bank, on Tuesday.