Essar Steel bankruptcy: Standard Chartered Bank’s petition raises transparency issue, says experts

The Standard Chartered Bank’s petition against Essar Steel’s Committee of Creditors (CoC) at the National Company Law Tribunal (NCLT) raises transparency issue that could undermine the bankruptcy proceeding under the Insolvency & Bankruptcy Code, legal experts said.

In its petition, the bank alleged that the CoC ‘illegally’ formed a core committee, which negotiated with ArcelorMittal.

The LN Mittal-company’s offer of Rs 42,000 crore – with an additional Rs 8,000 crore as equity infusion – had received the backing of 92 percent of CoC votes and is now awaiting approval from the NCLT.

But Standard Chartered alleged that the voting was flawed and illegal.