The National Company Law Tribunal (NCLT) Chennai has rejected the debt decision proposal of Siva Industries, promoted by C Sivasankaran, and ordered the liquidation of the corporate.
Rejecting the proposal, the Bench mentioned, “We conclude that this is not a proposal under Section 12A, but rather a restructuring proposal. There is no offer, nor a final acceptance. There is only ambiguity about the offer, hence this application stands dismissed.”
The decision plan was earlier cleared by the committee of collectors (CoC) led by IDBI Bank. The NCLT mentioned the settlement supply made by RCK Vallal, one of many shareholders of the corporate and father of Sivasankaran, doesn’t conform to Section 12A of IBC.
The NCLT had requested lenders to elucidate the massive haircut in one-time settlement plan authorised by the CoC. As a part of the proposal, banks will get 6.5 per cent of debt of Rs 4,863 crore from the supply made by the Sivasankaran household.
The household supplied to pay Rs 5 crore upfront and the remainder inside 180 days of approval.