Essar Steel insolvency: Arcelor Mittal moves SC against NCLAT order
ArcelorMittal, which was declared the highest bidder for debt-laden Essar Steel, on Thursday moved the Supreme Court against a part of the order of the National Company Law Appellate Tribunal (NCLAT) which had ruled that the profit of Rs 3,495 crore generated during the corporate insolvency resolution process cannot be given to it.
The appellate tribunal had held that the profit should be distributed among all the financial and operational creditors on a pro-rata basis of their claims.
The NCLAT had on July 4 said if ArcelorMittal did not pay the total dues to the creditors – financial creditors or operational creditors – “but pays lesser amount than the claim, then in such case, the profit should be distributed among all the creditors”.
It directed that “after the distribution of Rs 42,000 crore, if any amount is found to have been generated as profit during the CIRP after due verification by the auditors, it should be distributed among all the creditors… on a pro-rata basis of their claims subject to the fact that it should not exceed the admitted claim”.
Last week, State Bank of India-led committee of creditors of the insolvent firm had moved the Supreme Court against the NCLAT’s order that reduced their share of sale proceeds and also put financial creditors and operational creditors at par in the settlement of claims.
The petitions are coming up for hearing on July 22.