reliance capital case: NCLT extends the status quo in the Reliance Capital case until further order


The Mumbai bench of the National Company Law Tribunal (NCLT) on Monday directed to continue a status quo in an auction process of Reliance Capital until further order.

“We do not find any reason for not continuing the further direction till the time we pronounce order in the week beginning from January 30,” said the division bench comprising Justice PN Deshmukh and technical member Shyam Babu Gautam in an oral order, referring to its earlier order. “The interim direction will continue till we file further orders.”

This follows last week’s order of the bankruptcy court to maintain the status quo until January 23, in the matter, including deferring to the proposed auction for the sale of the Reliance Capital.

The tribunal’s direction comes in an application filed by the Torrent challenging the second auction and a late improved offer from the Hinduja group entity.

At the heart of the dispute is a bid from the Hinduja Group entity given 24 hours after the auction deadline (December 21), trumping the offer made within the stipulated time by Torrent Investments. While Torrent has offered an upfront payment of Rs 8640 crore, Hinduja offered Rs 8950 crore, including Rs 8110 crore as an upfront payment. However, both offers are below liquidation value.

While directing to maintain a status quo, the tribunal was referring to its order of March 3, which directed Reliance Capital’s administrator not to present the belated plan given by Hinduja Group before the committee of the creditor (CoC) for consideration.

In this case, senior advocates Mukul Rohtagi and Darius Khambata appeared for the Torrent. While senior counsel Kapil Sibal and advocate Prateek Seksaria and law firm Luthra & Luthra Law Office for the CoC and Ravi Kadam, senior advocate, appeared for the administrator Nageswara Rao Y in the case. Hinduja Group is being represented by senior counsels Harish Salve and Navroz Seervai.

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