The hearing will resume on July 9
Moneycontrol News
Pushing its case at the National Company Law Appellate Tribunal (NCLAT) on Thursday, ArcelorMittal argued that Numetal should be disqualified from bidding for Essar Steel as the VTB Capital -led consortium was acting in concert with Essar Group promoters.
Represented by lawyer Abhishek Manu Singhvi, ArcelorMittal argued that Ravi Ruia - one of the two co-founding brothers of the Essar Group - was disqualified from bidding for stressed assets under Clause 29A.
The Clause, under the Insolvency and Bankruptcy Code (IBC), bars promoters of defaulting companies from bidding for stressed assets.
Essar Steel was referred to the NCLT last year after accumulating nearly Rs 50,000 crore in loans and defaulted on interest payments.
Ravi Ruia's son Rewant Ruia was part of the Numetal consortium in the first round of bidding for Essar Steel.
ArcelorMittal argued that while IBC is silent on the issue of 'acting in concert,' it takes reference from the takeover code under the SEBI Act. "In a nutshell, ‘person acting in concert’ under Takeover Code (of SEBI) deems relatives like father and son to be acting in concert," Singhvi argued before the NCLAT judge.
"But the judge noted that the argument needs to be substantiated as per relevant Act," said a person present during the hearing.
The hearing will continue on July 9.
Numetal's case
The NCLAT hearing had resumed on July 2, after a month-long summer break. On July 3, Numetal argued that ArcelorMittal's bid for Essar Steel was not eligible as it was the promoter of two defaulting companies - Uttam Galva Steels and KSS Petron.
Numetal's lawyer Mukul Rohatgi argued that ArcelorMittal's offer to pay off dues was conditional and depended on the Mittal company winning the bid. He added that ArcelorMittal should be asked to make an upfront payment.
Numetal has pushed for the second round of bids to be considered as Rewant Ruia's Aurora Enterprises is no longer a part of the consortium.
JSW Steel had joined hands with Numetal in the second round. Vedanta Resources had also put in a bid.