ITPCL debt restructuring: NCLAT rejects SBI's objection on liquidation value provided by PNB
NCLAT has rejected SBI's pleas opposing the liquidation value of ITPCL provided by the debt-ridden firm's lead banker PNB and said the country's largest lender cannot «wriggle out» the debt restructuring process of the IL&FS group's thermal power company. The National Company Law Appellate Tribunal (NCLAT) has dismissed all three applications moved by SBI and said it does «not find any error in fixing the liquidation value as of 30.09.2018» of IL&FS Tamil Nadu Power Company Ltd (ITPCL).
The appellate tribunal observed that as per the RBI circular, an Inter-Creditor Agreement has been entered between the lenders.
Moreover, over 90 per cent lenders by value and 75 per cent by numbers have already approved ITPCL restructuring plan.
The lenders of ITPCL «with the requisite majority has already taken a decision to approve restructuring plan, the SBI, who is also one of the lenders, cannot be permitted to wriggle out of the terms of the ITPCL restructuring plan».
"… as per decision taken by the majority, prescribed in Clause 10 of the RBI Circular, the Restructuring Plan and the Liquidation Value taken therein is binding on the Applicant (SBI)," said NCLAT in its order passed earlier this month.
The RBI Circular mandates that Inter-Creditor Agreement has been entered between the parties, according to which any decision agreed by lenders with 75 per cent by value of total outstanding credit facilities and 60 per cent of lenders by number, shall be binding upon all the lenders.
ITPCL is an SPV (special purpose
