LN Mittal helps Pramod pay State Trading Corp claims
Pramod Mittal-owned Global Steel Holdings Limited (GSHL), Global Steel Philippines Inc. (GSPI) paid up their entire dues of Rs2,210 crore to the state-run State Trading Corporation of India Limited (STC) and thereby Mittal and his family members have come out of all criminal cases and look-out notices against them. NRI businessman Mittal, younger brother of steel baron Lakshmi Mittal, was facing multiple court proceedings in India and abroad in connection with his dues to STC.
 
Interestingly, GSHL, GSPI and the STC were having a long-standing business relationship from September 2003. However, the Mittal-owned companies claimed that because of an unprecedented meltdown in the steel industry and depression in the world economy during 2008-2010, GSPI suffered huge losses, and consequently, a substantial amount became due and payable to STC.
 
Following conciliation proceedings between GSHL, GSPI and STC, a sum of Rs1,605 crore, inclusive of principal and interest at the rate of 13.5% per annum on USD benchmark rates, was awarded to STC and was to be paid by GSHL/GSPI as principal debtors and Pramod Mittal as a guarantor.
 
Mittal has now paid Rs2,210 crore to STC, including Rs1,605 crore of principal amount as well as post award interest, in full and final settlement of STC's claim. Subsequent to this payment, no amount is due and payable to STC by GSHL, GSPI or Pramod Mittal.
 
The Supreme Court has, therefore, quashed all criminal cases and lookout notices against the Mittal, his wife and children. A bench of Justices Abhay Manohar Sapre and Indu Malhotra also quashed any lookout notices that may have been issued against Mittal and his family by these agencies, besides 11 complaints of cheating and criminal breach of trust pending in a lower court in Delhi.
 
STC has also agreed not to pursue winding up proceedings against GSHL in the Isle of Man court.
 
The SC bench invoked its extraordinary powers to quash all proceedings.
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    COMMENTS

    Anil Kumar

    9 months ago

    Credit to Modi government / SC / Investigative agencies. The firmness and resolute pursuit of Vijay Mallya and Nirav Modi is waking up others.

    Pension, PF dues not part of liquidation estate: NCLT
    The National Company Law Tribunal's (NCLT) New Delhi bench has ruled that the dues of provident fund (PF), pension and gratuity do not form the part of liquidation estate of corporate debtors.
     
    According to the NCLT, such dues cannot be included in the assets to be liquidated for settling the claims of creditors in accordance with Section 53 of the Insolvency and Bankruptcy Code (IBC), 2016.
     
    The tribunal gave this ruling while hearing an application filed by the workmen demanding the release of their dues related to PF, pension and gratuity from the "waterfall mechanism" or the scheme for distributing the proceeds from the liquidation of assets of a corporate debtor in preferential order as mentioned in Section 53 of the IBC.
     
    As per the Official Liquidator, the above mentioned dues do not come under the reach of "workmen's dues" as mentioned under Section 53 of the IBC.
     
    But the NCLT has ruled that all sums due to any workman or employee from the PF, pension fund and gratuity fund were not included in the expression "liquidation estate assets".
     
    "Once the sum due to any workman or employee from the provident fund, pension fund and gratuity fund are not constituting a part of the liquidation estate, we fail to understand as to how Section 53 could be invoked along with its explanation. 
     
    "According to Section 53, the proceeds from the sale of the liquidation assets are to be distributed in the manner specified therein .Therefore, the aforesaid amount of the workmen's dues cannot be a part of liquidation estate assets," it said in its verdict.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Jet Airways: Naresh Goyal, Wife Anita Step Down from Board, Lenders To Provide Rs1,500 Crore
    Jet Airways (India) Ltd chairman Naresh Goyal and his wife Anita have decided to step down from the carrier's board of directors. Mr Goyal, the founder of Jet Airways have also agreed to reduce his 51% stake to 25.5%. Lenders, including State Bank of India (SBI) and Punjab National Bank (PNB) have agreed to provide Rs1,500 crore as funding for restoring normalcy of Jet’s operations.
     
    In a regulatory filing, Jet Airways says, "Two nominees of promoter, Mr Goyal and Ms Anita Goyal and Kevin Knight, the nominee of Etihad Airways PJSC to step down from the board. Additionally Mr Goyal to also cease to be the chairman of the company."
     
    Jet Airways will issue 11.4 crore shares of Re1 each to the consortium of lenders led by SBI to convert the carrier’s outstanding debt.
     
    “Immediate funding support of up to Rs1,500 crore by lenders by way of issue of appropriate debt instrument against security of its assets, which will restore normalcy to Company's level of operations,” the carrier said.
     
    In its board meeting, Jet Airways also agreed to induct two nominee directors representing the lenders.
     
    The debt-ridden carrier have also decided to set up an interim management committee to manage and monitor its daily operations and cash flow.
     
    Last week, after meeting with government officials, SBI chairman Rajnish Kumar had told reporters that putting Jet Airways into bankruptcy was the 'last option' and that its lenders are making every effort to keep the airline flying.
     
    “We believe that it is in everybody’s interest that Jet Airways continues to fly,” the SBI chairman had told reporters after a meeting with government officials, adding that placing Jet Airways into bankruptcy would mean grounding the airline.
     
    According to estimates, Jet Airway's total debt stood at Rs8,000 crore. The company urgently needed funding to maintain whatever was left of its market shares, even as the airline pilots and crew were said to be approaching other airlines for employment.
     
    The airline's pilots along with engineers and other highly critical segment of employees have not been paid salaries from 1 January 2019 and only 12.5% of December pay was given.
     
    At an extraordinary general meeting (EGM) in February 2019, shareholders of Jet Airways had approved, by an overwhelming majority, a proposal to convert a part of the company's loans into shares.
     
    This was a significant development as the approval was required to go ahead with the bank-led provisional resolution plan (BLPRP) led by the consortium of the lenders. As part of the plan, public sector lenders would become the largest equity owners of the airline, virtually making it a nationalised carrier.
     
    Etihad, however, abstained from voting on various proposals during the EGM.
     
    "The BLPRP currently estimates a funding gap of Rs8,500 crore, including proposed repayment of aircraft debt of Rs1,700 crore, to be met by appropriate mix of equity infusion, debt restructuring, sale or sale and leaseback or refinancing of aircraft, among other things," Jet Airways had said in a regulatory filing.

     

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    COMMENTS

    Mohan Krishnan

    9 months ago

    Deep State in action.

    Harish Kohli

    9 months ago

    Am not receiving alerts.

    Harish Kohli

    9 months ago

    Rao ji, I beg to differ with your quote "there is nothing left to eat . With due apologies to the Goyals , it should be "there is nothing left to steal". I also disagree with "shutter the airline". I know a family coming from overseas and travelling in India. They are in tenterhooks. What has been their fault. The fault is with the people in power.
    I heard stories about how Goyal got the permission to start the airline. I also hear rumours of how they prevented competitors make an entry. I also heard rumours of who helped them support leading to this state. Lastly I do hope to see Goyals cooling their heels in jail.

    SuchindranathAiyerS

    9 months ago

    Modi's gang get SBI and PNB to fork out 1,500 Crores in exchange for some modifications to the Board of Directors. All hunky dory unlike Kingfisher.

    Harish Kohli

    9 months ago

    Rao ji, I beg to differ with your quote "there is nothing left to eat . With due apologies to the Goyals , it should be "there is nothing left to steal". I also disagree with "shutter the airline". I know a family coming from overseas and travelling in India. They are in tenterhooks. What has been their fault. The fault is with the people in power.
    I heard stories about how Goyal got the permission to start the airline. I also hear rumours of how they prevented competitors make an entry. I also heard rumours of who helped them support leading to this state. Lastly I do hope to see Goyals cooling their heels in jail.

    K V RAO

    9 months ago

    Goyal and his associates promoters stepping down is not at all a big or good news. They have stepped down because there is nothing left to eat. I sympathize the state lenders. Goyal has had a last laugh in handing over the management. Take a loan, milk it to the hilt and when nothing is left, hand over it to lenders. On the top of this, SBI and it's co-lenders are celebrating as if they have done the impossible. This has also become a case study for other promoters who can be rest assured that after burgling the ship, they can take it to the shore and give it to lenders for further sailing. What a novel approach to break the bad egg?

    REPLY

    Harish Kohli

    In Reply to K V RAO 9 months ago

    Rao ji, I beg to differ with your quote "there is nothing left to eat . With due apologies to the Goyals , it should be "there is nothing left to steal". I also disagree with "shutter the airline". I know a family coming from overseas and travelling in India. They are in tenterhooks. What has been their fault. The fault is with the people in power.
    I heard stories about how Goyal got the permission to start the airline. I also hear rumours of how they prevented competitors make an entry. I also heard rumours of who helped them support leading to this state. Lastly I do hope to see Goyals cooling their heels in jail.

    S Balakrishnan

    In Reply to K V RAO 9 months ago

    Well said.
    I was wondering why the papers said board meets in London till I realised this guy's escaped to London following his illustrious predecessors - v m,n m and r p.
    Sbi is throwing good money after bad thoughtlessly or more likely under pressure.
    One hopes at least the good money is used to pay the suffering employees.
    Then shutter the airline.
    Otherwise sbi risks losing its shirt-again.

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