NCLT rejects Essar Power Jharkhand ex-promoters’ proposal to clear dues

he National Company Law Tribunal (NCLT) has rejected ₹1,200-crore offer by former promoters of Essar Power Jharkhand Ltd (EPJL) for one-time settlement with the lenders and take the debt-ridden company out of insolvency proceedings.

After the Committee of Creditors (CoC) of EPJL, in which ICICI Bank has over 90 per cent voting rights, declined the ₹1,200-crore settlement proposal against a total debt ranging around ₹5,600 crore, a two-member bench of NCLT headed by Justice MM Kumar rejected promoter’s offer.

“A proposal made by the ex-promoter/director pursuant to the direction issued on March 11, 2019 and subsequently clarified by filing one affidavit dated May 16, 2019 does not find favour of the ICICI Bank-Financial Creditor who constitutes 99.34 per cent voting share of the CoC,” said NCLT. It further said: “There are plausible reasons given for not accepting the proposal. Accordingly, we are unable to accept any such proposal and the same is hereby rejected.”