December 7: The National Company Law Appellate Tribunal (NCLAT) on Friday stayed the order directing ArcelorMittal India to pay about ₹1,300 crore as the Corporate Insolvency Resolution Process (CIRP) charges to Odisha Slurry Pipeline Infrastructure (OSPIL).
“As an ad-interim, the operation of the impugned order as regards making of payment by the Appellant (ArcelorMittal India) to ‘OSPIL’ by December 15, 2020 shall remain stayed till next date of hearing,” NCLAT said in its order on December 4, the Business Line reported. The matter has been listed “for admission” on January 22.
It is to be noted that the Ahmedabad bench of the National Company Law Tribunal (NCLT), had in its order on November 10, recognized the charges for the use of slurry pipeline for running Essar Steel as a going concern as CIRP costs. The order was passed based on a petition filed by the Srei Infrastructure Finance (SIFL), the financial creditor.
Accordingly, NCLT had ordered ArcelorMittal India to pay the amount by December 15.
Harish Salve, the senior counsel representing ArcelorMittal India, submitted that in terms of the impugned order, the company has been directed to make the payment of the aforesaid charges as IRP costs to an entity which had not claimed it during the CIRP of ‘ESIL’ or even thereafter.
According to a spokesperson for Srei, while everyone has the right to appeal against a judgment, even in the higher court, the final decision is always taken based on the merits of the matter.
“We are confident that the NCLAT shall be appreciating the relevant facts in its proper light during the course of the proceedings,” the spokesperson said.
Essar should have paid the outstanding RTU charges to OSPIL. Consequent to its resolution, the successful resolution applicant ought to have paid the outstanding RTU charges as CIRP costs in terms of its own approved resolution plan.
“If the payments were made in a timely manner, OSPIL would have serviced its debts due to its lenders and there would have been no occasion for it to be taken for insolvency as the lenders/shareholders of OSPIL would not have suffered any losses. The NCLT judgment has simply recognised this reality in a fair and balanced manner,” the spokesperson said.