The National Company Law Tribunal has set a precedent by choosing a resolution professional not originally on the panel submitted by lenders, marking the change of guard on expiry of the first deadline for the Rs 10,000-crore debt-recast programme at a troubled English-language broadsheet of peninsular India.
The Hyderabad chapter of the insolvency court has replaced the existing interim resolution professional, setting aside recommendations from the committee of creditors (CoC) in the Deccan ChronicleBSE -4.17 % Holdings loan default case.
The judges went through three names given by the CoC. While one profile was rejected for not sticking to procedures, the other two were ignored on grounds of eligibility, said a person present in the court.
The court handpicked Kolkata-based Mamta Binani, the resolution professional in the Synergies Dooray case that is seen as the first successful example of debt recast under the new Insolvency and Bankruptcy Code, said the source.
Mamta Binani declined to comment on the matter.
The company took more than 100 loans amounting to Rs 10,000 crore from more than a dozen banks between 2004 and 2012. Those lenders include Canada Bank, Andhra Bank, and Indian Overseas Bank.
A few days earlier, the committee of creditors decided to replace the existing resolution professional with no resolution plan in sight even after six months. NCLT has now extended the deadline by another 90 days, said sources familiar with the mater.
“The bench also stated that creditors did not give 75% vote to any of the three names proposed,” the person said.
Insolvency professionals are mandated to act as the bridge among all related parties to curve out either a successful resolution plan or prepare the company for liquidation. During the 270-day stipulated period, the insolvency professional primarily runs the show.