The National Company Law Tribunal on Thursday allowed Torrent Investment Ltd.'s plea against the administrator's move to consider a revised bid by the Hinduja group. The court further halted the 'extended round of auctions' proposed by the committee of creditors and held it in violation of the insolvency code.
The court had earlier ordered parties to maintain the status quo in the dispute.
The bidding process for Reliance Capital Ltd. concluded on Dec. 21, 2022, with Torrent emerging as the highest bidder with Rs 8,640 crore.
Torrent Investments had approached the insolvency court earlier this month, alleging irregularities in the resolution process. The process, according to it, has been structured in such a manner as to give preferential treatment to certain bidders.
The committee of creditors has allowed Hinduja Group, yet another bidder in the process, to revise their bid after the conclusion of the auction process, Torrent said. It is claimed that this is in violation of the provisions of the insolvency code.
However, the revision comes well within their right to negotiate with the bidders and must not be interfered with, according to the committee of creditors. After considering the objections, the court granted Torrent interim relief on Jan. 3 by prohibiting the administrator from presenting any non-compliant bids to the committee of creditors.
Unable to conclude the bidding process, the committee of creditors unanimously decided to hold an "extended auction", which was scheduled to be held on Jan. 19 but was later rescheduled for Jan 23 as per the court's request. This was in consideration of the fact that objections were also made against the fresh round of auctions. The auction, according to Torrent, is meant to assist the Hinduja group in illegally revising the bid.
But on the day of the auction, the court ordered the committee of creditors to maintain the status quo until the disputes are resolved.
In an effort to conclude the process, which was supposed to be completed by Jan. 31 (now extended till March 18), the committee of creditors approached the appellate tribunal, seeking a review of the status quo order.
The court refused to rule on the merits and asked them to wait until the final orders were issued.
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