The National Company Law Appellate Tribunal permits promoters of Sterling Biotech (undergoing its liquidation) to take back control
By INSOL INDIA EDITORIAL BOARD Posted On : September 18, 2019
Vide its order dated August 28, 2019, the National Company Law Appellate Tribunal (“NCLAT”) passed a conditional order permitting the promoters of Sterling Biotech Limited (“SBL”), to regain control of the corporate debtor. SBL was ordered to be liquidated by the Mumbai Bench of the National Company Law Tribunal, vide its order dated May 08, 2019.
The NCLAT, while allowing the promoters of SBL to settle with its creditors, imposed the following conditions, (a) all stakeholders of SBL including operational creditors should be paid in accordance with the proposal of the promoters which had received 90% approval of the creditors of SBL; and (b) the stakeholders of SBL should be paid with monies which are not proceeds of a crime and which have been certified to not be proceeds of a crime by the Enforcement Directorate.
The NCLAT also stated that in case the settlement is not made in accordance with the conditions imposed by the NCLAT, then SBL will be directed back into liquidation.
Vide its order, the NCLAT set aside the corporate insolvency resolution process of SBL and stayed the liquidation process of SBL.
For the full text of the order, please refer to the link
For more details please visit https://nclat.nic.in/Useradmin/upload/6800044965d6e00f2674eb.pdf