The move comes on the heels of a recently concluded commercial understanding with Aditya Birla Group's UltraTech Cement to sell its entire 98.43% stake in its subsidiary for Rs 7,266 cr
As the bidding war for Binani Cement gets bitter by the day, the parent Binani Industries Ltd on Thursday sought termination of the corporate insolvency proceedings against its cement manufacturing subsidiary.
In its application made on Thursday at National Company Law Tribunal (NCLT), the company claimed that it can pay off all its creditors.
"We have filed an application seeking termination of insolvency proceedings and we also said Binani Industries can pay off all the creditors. This application is likely to be heard on next Tuesday," said an advocate representing Binani.
He also said the directors of Binani Industries have also challenged the process of conducting the insolvency proceedings.
The move comes on the heels of a recently concluded commercial understanding with Aditya Birla Group's UltraTech Cement to sell its entire 98.43% stake in its subsidiary for Rs 7,266 crore, more than Rs 1,000 crore higher than the highest bid received by Dalmia Bharat-led consortium.
The Resolution Professional (RP) has already submitted the resolution plan of Dalmia-led consortium before the NCLT as the "highest bidder" to take over the debt laden company.
As the fight for the troubled cement company got muddled in offers and counter offers, the RP had alleged that the "fraudulent transactions" were made by the Binani group on the basis of a forensic audit report.
Citing a forensic audit report, before the court, RP's counsel Abhrajit Mitra on Thursday said a loan of about Rs 1,100 crore was given by the corporate debtor, Binani Cement, to its holding company Binani Industries.
"The loan was given to Binani Industries to buy back shares of its subsidiary. As per the balance-sheet, Rs 1,100 crore was payable to the company (Binani Cement) by its holding company. What is the fraudulent transaction was that the interest chargeable was fully waived," he asked.
The RP, said his counsel, has filed an application based on the forensic audit report of the fraudulent transaction of the previous management. The counsel, however, said the matter of fraudulent transaction was a separate one and it was incumbent on the RP to bring this to the notice of NCLT bench.
On its part, Binani Industries has denied all the allegations.
"We have not been served a copy of the application dated 13th March, 2018. No sooner the application is served upon us, we shall deal with the same. The question of any fraud committed by the company or by the members of the Board of Directors of the company does not and cannot arise as all the accounts of the company and the holding companies are fully audited and all the transactions, including the related party transaction have been disclosed," Binani Industries said in a filing with the stock exchanges.
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