NCLAT to hear Shapoorji Pallonji's plea on Korba West Power on Oct 15

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Construction to shipping conglomerate Shapoorji Pallonji Group has approached the National Company Law Appellate Tribunal (NCLAT) against a judgment of Ahmedabad Bench of National Company Law Tribunal (NCLT) approving a resolution plan that gave no funds to the company. The NCLAT will hear the case on October 15.  

The Ahmedabad Bench had in June approved a resolution plan for Korba West Power, which gave the unsecured financial creditor its entire claim while handing the secured lenders only 32.84 per cent of their claimed amount. Shapoorji Pallonji, which had constructed the Korba West Power plant, got ‘nil’ amount against their total claim of Rs 45 crore.

The resolution professional of the corporate debtor had said as arbitration proceeding was ongoing between the Shapoorji Pallonji and Korba West when the moratorium period kicked in, the former would be entitled to no-zero per cent payment for the construction company. 

The company on the other hand said that as operational creditors had been paid 35.79 per cent of their admitted claims, they should also have been either paid that much or be allowed to pursue the arbitration proceedings and claim their due accordingly.

Secured financial creditors of the company have received Rs 1,100 crore, against their total admitted claim of Rs 3,346 crore, while unsecured lenders have been provided 100 per cent of their Rs 1,685 crore claim under the approved plan.    

The NCLAT has allowed Shapoorji Pallonji to implead Adani Power, the successful resolution applicant, as a respondent in the case. Adani Power is also an unsecured creditor in the case, and its resolution plan was approved by the lenders with 69 per cent voting share.

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