NCLAT to hear pleas challenging Birla Tyres' resolution plan in Dec-Jan

livemint.com:

Himadri Speciality Chemical Ltd and Dalmia Bharat group to jointly acquire Birla Tyres. Another petition involves Kesoram Industries Ltd, the parent company of Birla Tyres, contesting the rejection of its claims as a financial creditor in the Birla Tyres insolvency process. Additionally, Manav Investment and Trading Company Ltd, a shareholder, is raising a worker's claim in its case.

In its plea, HDFC Bank contended that the distribution of shares among financial creditors in the resolution plan was based on the value of the security of interest, which it argued went against the law. The bank claimed that the Committee of Creditors (COC) justified this distribution by citing their commercial wisdom. The COC said HDFC Bank's petition had no merit as it challenged the majority decision of the committee without contesting the resolution plan itself.

The COC asserted that its decisions cannot be overturned, even by NCLAT, unless the resolution plan violated the provisions of the Insolvency and Bankruptcy Code (IBC). However, HDFC Bank clarified it had challenged the resolution plan. The tribunal issued notices to the involved parties, seeking replies and rejoinders, and the hearing has been deferred until January.

The parent company challenged its exclusion from the list of financial creditors by the new Resolution Professional (RP) in the Birla Tyres case. Initially recognized as a financial creditor with ₹516 crore worth of claims and a 30% voting share, Kesoram claimed the new RP overturned the decision. They argued that the RP lacked the authority to revisit admitted claims.