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Tuesday,03-August-2021

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BPSL resolution: Supreme Court to hear Sanjay Singhal’s plea on Friday

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The Supreme Court will on Friday hear the former Bhushan Power and Steel’s MD and promoter Sanjay Singhal’s plea against the approval to JSW Steel’s takeover of the bankrupt steel company.

Singhal has filed a special leave petition before the Supreme Court saying the National Company Law Appellate Tribunal (NCLAT) has erroneously allowed JSW Steel to retain Bhushan Power & Steel’s earnings before interest, tax, depreciation and amortisation (EBITDA) to the tune of Rs 3,000 crore generated during the corporate insolvency resolution process (CIRP).

Last month the appellate tribunal had permitted JSW Steel to acquire the bankrupt company and granted it immunity from prosecution by the Enforcement Directorate (ED).

In September 2019, the National Company Law Tribunal had approved its resolution plan to take over the insolvent company, but the Enforcement Directorate, investigating alleged fraud committed by the debt-laden firm’s previous management, had attached the assets of BPSL which, it believed, were acquired from proceeds of crime, following which JSW Steel moved the NCLAT to seek immunity from the proceedings.

Some experts feel that the takeover of Bhushan Power and Steel by JSW Steel would go against the spirit of the Insolvency and Bakruptcy Code (IBC), as the code was formulated to maximise the value of the assets, but JSW Steel’ s bid of Rs 19,700 crore is way lower than the total exposure of the baks, which stands at over Rs 40,000 crore.

Further, its resolution plan of JSW Steel has also faced obstructions as it is a related party to the bankrupt Bhushan Power Steel.

The Enforcement Directorate had told NCLAT that JSW Steel cannot get immunity from the criminal charges being faced by Bhushan Power and Steel if it acquires the latter, because both are related parties.

The appellate tribunal approved the takeover under the new amendment to the IBC which provides immunity to the new owners from ongoing criminal proceedings against the erstwhile promoters of the company.

“We hold that the assets of the corporate debtor of which JSW Steel is a resolution applicant are immune from attachment by the Directorate of Enforcement under Section 32(A) of the IBC (Insolvency and Bankruptcy Code),” NCLAT said in February while clearing the stalled resolution plan.

There are also differing views among legal experts on the matter.

On the issue of banks taking a large haircut, Manoj Kumar of Corporate Professionals said: “They (banks) know that this will be a viable proposition after this haircut, this amount is fully secured. Banks have to see rationally how much they can recover, if they can get this much only then they should take and go…”

“This is not against the spirit of IBC, this will happen,” he said.

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Essar Oil UK announces appointment of Chief Executive Officer

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The Board of Directors of Essar Oil (UK) Limited on Monday announced the appointment of Deepak Maheshwari as its Chief Executive Officer.

EOUK’s Stanlow Manufacturing Complex is a key strategic national facility, annually producing over 16 per cent of the UK’s road transport fuels.

Maheshwari joins EOUK at a transformative juncture as it accelerates its transition to a ‘Low Carbon Energy Provider’ of the future.

As CEO, Maheshwari will work closely with the EOUK Board on the delivery of a number of strategic energy transition projects which are aimed at making Stanlow a green refinery to meet the post-carbon needs of a progressive UK.

Amongst these are HyNet (a low carbon hydrogen energy and carbon capture project) which will transform the North West of England and North Wales into one of the world’s first low carbon industrial clusters, together with the building of a Biofuels business which will include production of both renewable diesel and sustainable aviation fuel (SAF).

With more than 25 years’ senior leadership experience, across the utilities, energy, and infrastructure sectors in Europe and Asia, Maheshwari will lead an experienced management team and further strengthen corporate governance within the ESG framework.

Most recently, Deepak was CFO and Head of Strategy at Adani Ports and Special Economic Zone Limited, India’s largest commercial multi-port operator. He was previously CFO of Essar Energy Limited.

EOUK Chairman, Prashant Ruia, said: “We are delighted to welcome Deepak to EOUK. His immense corporate experience will prove invaluable during such an important period of growth for the company, which is aiming to be a leading player in the transition towards a sustainable society by delivering cleaner energy solutions.”

“I am delighted to be joining EOUK as Chief Executive Officer and look forward to building on the impressive legacy that Essar colleagues have created. The UK’s green economy continues to develop and flourish and the Board and I will work hard to ensure EOUK sits at the fulcrum of the UK’s sustainable, low carbon future.”

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Odisha records 54% growth in GST collection in July

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Odisha recorded 54 per cent growth in Goods and Services Tax (GST) collection in July as compared to the corresponding month of the previous year, officials said on Monday.

According to an official statement issued by the office of the state GST commissioner, Odisha collected GST worth Rs 3,615 crore in July 2021 as against Rs 2,348 crore collected in July last year.

This growth rate of GST in Odisha is the second highest among all major states in India after Maharashtra, the statement said.

GST collection till July end of this financial year is Rs 13,661 crore, as against Rs 7,540 crore collected till July last year, thereby recording a growth of 81 per cent.

The state collected Rs 927 crore in CGST, Rs 1,028 crore in IGST and Rs 592 crore in cess in July. Moreover, the total collection of VAT (petrol and liquor) was Rs 824.53 crore in July as against Rs 611.36 crore collected in July 2020, recording a growth of 34.86 per cent.

The revenue collection from liquor recorded a growth of 36.36 per cent, officials said.

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Will Goa resume mining? Industry dependents seek clarity

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Days after the Goa assembly passed the Goa Mineral Development Corporation Bill 2021, paving way for setting up of the body to revive mining in the state, the Goa Mining People’s Front, an umbrella organisation for mining dependents in the state on Monday demanded a timeline for resumption of mining activity.

The Front, a collective of now-unemployed mining industry workers and owners of businesses linked to the industry, has also said that the bill passed in the state assembly to form the Corporation had no roadmap for revival of mining.

“There is transparency required on how this is going to enable early resumption of mining in Goa and restore the livelihood lost which is more vital in current circumstances. The bill does not spell out any intent about protecting the interest of local people by creating employment,” a statement issued by the Front’s president Puti Gaonkar said.

“The current bill does not mention about induction of workers or trucks directly by corporation so the interest of local people does not form a part of the bill. Goans have faced a lot of hardships because of repeated bans on mining in the last one decade and are now looking for stable and sustainable livelihoods,” the statement said.

Mining activity in Goa was banned by the apex court first in 2012, following the unearthing of a Rs 35,000 crore scam by a judicial commission appointed by the central government. But was resumed in 2015 with restrictions, before it stopped again after the apex court found irregularities in renewal of 88 mining leases and stopped all ore extraction activity from March 2018.

According to Chief Minister Pramod Sawant, forming the Corporation would enable the state government to fast-track resumption of mining activity in the state.

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