The National Company Law Appellate Tribunal (NCLAT) has decided to postpone the hearing in the ongoing insolvency case of SREI Infrastructure. The delay comes after SREI Infrastructure sought additional time to submit a rejoinder in response to the Reserve Bank of India’s (RBI) submission.
The case at hand was brought to NCLAT by Adisri Commercial, the former promoter of SREI Infrastructure. Adisri Commercial is challenging the decision made by the Kolkata bench of the National Company Law Tribunal (NCLT).
During the previous hearing, NCLAT had instructed the RBI to provide a response to the plea within a three-week timeframe. The RBI complied with this request.
In October 2021, NCLT’s Kolkata bench issued an order allowing the RBI’s plea under Section 227 of the Insolvency and Bankruptcy Code, 2016. This effectively admitted Srei Equipment under the Corporate Insolvency Resolution Process (CIRP).
An earlier plea by Adisri Commercial, which challenged the NCLT’s order, was dismissed by NCLAT in December 2022.
In its latest plea, Adisri Commercial argued that its initial appeal was dismissed primarily due to a filing delay and was not evaluated on its merits. The company claims it does not owe the debt as asserted by the RBI and was not given the opportunity to prove the absence of this debt.
The RBI countered this argument by stating that revisiting the dismissed appeal could disrupt the ongoing Corporate Insolvency Resolution Process, reset the timeline, and potentially set a risky precedent. The fact that the Supreme Court previously dismissed the appeal adds to doubts about recalling the order.
It’s worth noting that in October 2021, the RBI took action by replacing the boards of both SREI Infrastructure Finance and its subsidiary, SREI Equipment Finance, due to governance and default concerns.
In August of the current year, the Kolkata bench of the NCLT approved the resolution plan presented by the National Asset Reconstruction Company (NARCL) for the takeover of the two Srei firms under the Insolvency and Bankruptcy Code. The resolution plan had previously received approval from the RBI.
Since the approval of the resolution plan, NARCL has disbursed approximately ₹2,580 crore to creditors, signifying a significant step forward in the resolution process. The case continues to be closely monitored by all parties involved.
