Vedanta accuses JAL creditors of preaching ‘process’ while ignoring it themselves
Anil Agarwal-led Vedanta on Thursday told the Delhi bench of the National Company Law Appellate Tribunal (NCLAT) that the committee of creditors (CoC) in Jaiprakash Associates Ltd’s insolvency case had consistently insisted on following “process” but they did not appear to be following it. Legal battle focuses on whether CoC can rightfully reject Vedanta’s offer ₹17,000 crore bid in favor of Adani Group’s undervalued plan based on superior cash terms.
Advocate Abhijeet Sinha, representing Vedanta, made serious allegations against the CoC, saying that Vedanta’s bid was ignored despite being the highest bid after the five-round objection process. “There was supposed to be some transparency in the scoring process but there was nothing,” Sinha said.
The appellate court heard Vedanta’s arguments and scheduled the next hearing for April 17, when the Adani Group and the CoC are expected to respond.
The case highlights important questions regarding the transparency and procedural standards of large-scale CoCs. bankruptcy proceedings. Vedanta objected to the design of the bidding process, arguing that failure to disclose key financial components of competing bids hindered genuine competition. The company argued that transparency was essential to ‘maximising value’, which is the main purpose of insolvency proceedings.
Vedanta, in particular, claimed that without knowing the specific mix of upfront cash and deferred payments, they were unable to effectively optimize their own bids, as bidders were only shown the highest net present value (NPV) after each round.
setting a precedent
The outcome of the case could set an important legal precedent for how assets are valued. Insolvency and Bankruptcy Code (IBC). With high-value assets at stake, including around 4,000 acres of land, hotels, commercial properties, cement plants and an F1 circuit, the final decision will test whether the CoC’s “commercial wisdom” allows it to legally reject a higher offer in favor of other factors.
On April 6, a Supreme Court bench led by Chief Justice Surya Kant and Justice Joymalya Bagchi had refused to interfere with the orders of the National Company Law Tribunal (NCLT) and NCLAT, paving the way for the implementation of the scheme. However, the court directed the committee overseeing the decision to seek NCLAT approval before taking any major step.
Adani’s solution plan has been fixed ₹14,543 crore, includes additional ₹800 crore towards capital expenditure and working capital, taking the total to approx. ₹15,343 crore. Against the allegations made against him ₹60,637 crore, which represents an improvement of around 24%.
Vedanta said it had submitted a general offer of approximately 200 thousand lira. ₹17,000 crore, i.e. approx. ₹12,505 crore on an NPV basis and argued that it offers better value. But lenders chose Adani’s plan because it offered ₹The upfront and faster payment of Rs 6,000 crore in two years compared to Vedanta’s five-year timeline led Vedanta to claim that the process was unfair. “Apparently the COC did this by saying: ‘We kept you (Vedanta) in the participation rounds. Thank you, you can come back now,” Sinha told NCLAT.
The resolution plan was approved by the Allahabad bench of the National Company Law Tribunal (NCLT) on March 17, following which Vedanta moved the NCLAT and the Supreme Court in an attempt to stop it.
