The Gujarat High Court on Monday disposed of the petition moved by Essar Steel challenging the insolvency proceeding against it by Reserve Bank of India without granting any relief to the company. A single bench of justice SG Shah pronounced the order which was reserved after a detailed hearing last Friday.
Essar Steel had moved the court against Reserve Bank of India (RBI) for initiating insolvency procedure against it. The apex bank has issued a release on June 13 directing the banks to start insolvency procedure against a dozen stressed companies including Essar.
Following the RBI direction, a joint lenders’ forum led by State Bank of India (SBI) initiated proceeding in the National Company Law Tribunal (NCLT) under the newly-formed Insolvency and Bankruptcy Code. Against this initiative the Essar Steel moved High Court and got a stay on all proceedings against the company at tribunal.