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Supreme Court does well on Essar Steel bids – Here is why

14 23 19
05.10.2018

Though the resolution process for Essar Steel’s NPAs has been dragging for more than a year against the allowed 180 days—with an extension of another 90—the Supreme Court has done well to put an end to the needless wrangling and posturing by all parties by piercing the corporate veil. In the case of ArcelorMittal, while it was ineligible to bid under Section 29A of the Insolvency and Bankruptcy Code (IBC) since it was a promoter of Uttam Galva that owed banks Rs 7,000 crore, it insisted it owed no dues.

Amazingly, it was allowed to sell its shares in Uttam Galva and so was no longer classified as a promoter; it is not clear why the banks allowed this sale to go through. When public indignation forced the issue, ArcelorMittal paid the money into an escrow account, but said this was to be released only after........

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