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MUMBAI: The National Company Law Tribunal (NCLT) on Thursday held that lenders to the bankrupt Reliance Capital (RCap) cannot again invite fresh bids for the company. The court, in its order, said that the financial bid by Torrent Group was the highest and extending the challenge mechanism violated insolvency regulations.
The committee of creditors may appeal to maximise their recovery as Hinduja Group had offered to pay more after the auction process was over. The NCLT expressed concern at the tendency of the lenders to make the resolution process open-ended and said their claim that they can conduct as many challenge processes as they want is not consistent with the regulatory provisions and defeats the progress made in the development of a successful insolvency regime.
“The challenge mechanism for financial bids with respect to the corporate debtor under the challenge process note stood concluded on December 21, 2022 with the financial bid of the applicant (Torrent Group) at Rs 8,640 crore being the highest financial bid,” the order said.
It also said the respondents, administrator and the committee of creditors shall not allow any deviation in the highest net present value (NPV) financial proposal of Rs 8,110 crore of IndusInd Holdings and the highest NPV financial proposal of Rs 8,640 crore of Torrent.