Financial Express, citing sources, reported that the resolution process for Essar Steel which has been delayed due to the ineligibility of bids received in the first round of bidding is likely to be granted some time beyond the stipulated 270 days to prevent the company from being liquidated.
A banker with a large public sector bank told FE “The time spent in litigation to ascertain the legitimacy of the bids is likely to be exempted from the 270-day period. This will provide some extra cushion for the process to be completed. While every effort will be taken to complete the process in time after the new bids are submitted, we cannot rule out the possibility of further litigation. It would be good to have some additional time on hand.”
The last date for submitting resolution plans in the second round of bidding is April 2.
The 270-day deadline for Essar Steel ends on April 29. As per the Insolvency and Bankruptcy Code (IBC), 2016, a resolution plan has to be finalised and approved within 270 days of a company’s admission to the National Company Law Tribunal (NCLT). In the absence of an approved resolution plan, the company would be liquidated at the end of the 270-day period.
Source : Financial Express