13 April 2019: The dedicated bankruptcy court has stayed its earlier order to allow the withdrawal of corporate insolvency process of Sterling SEZ & Infrastructure, a firm owned by brothers Nitin and Chetan Sandesara, believed to be abroad and running away from Indian law.
The Mumbai-bench of the National Company Law Tribunal (NCLT) on Friday stayed its earlier order after the Ministry of Corporate Affairs (MCA) informed the tribunal that a similar withdrawal is pending in another bench from the same promoters and the government is keen to intervene in the matter.
“The government representative has informed the members in chamber after which the bench had decided to stay the earlier withdrawal,” said a senior government official privy to the development. “The tribunal will hear the case on March 25 and 26 for Sterling SEZ and Sterling Biotech, respectively.”
Earlier on Wednesday, the tribunal had allowed the one-time settlement payment to lenders by the company’s promoters.
Currently, Gujarat-based Sterling Group’s three companies, including Sterling Biotech, Sterling SEZ & Infrastructure and its trading arm Sterling International are facing insolvency cases in Mumbai NCLT. The group owes about Rs 15,000 crore to its financial and operational creditors. Sterling SEZ owes over Rs 4,500 crore to its financial and operational lenders.
On Wednesday, in the case of Sterling SEZ & Infrastructure, the NCLT allowed the withdrawal of the Corporate Insolvency Resolution Process (CIRP) in the matter of Sterling SEZ as approved by over 92% of the creditors as Sandesaras had offered to pay about half the dues to settle the dispute.
While in the case of Sterling Biotech, the promoters have offered to pay about Rs 3,100 crore to settle dues of around Rs 8,100 crore and over 90% of the lenders have agreed to withdraw the case.
However, since the promoters are absconding, the tribunal has directed regulators and probe agencies to file their response before allowing lenders to settle and withdraw the case.