The NCLAT has rejected a petition by Deccan Value Investors, challenging NCLT’s approval of its resolution plan for debt-ridden MTech Auto without executing the lease of a property.
The three-member National Company Law Appellate Tribunal (NCLAT) bench also imposed a cost of Rs 1 lakh on US-based hedge fund Deccan Value Investors (DVI) LLP, terming the petition as “trivial”.
It stated that the execution of the long-term lease (20 years) of Ace Complex Land is not a condition in relation to the approval of the resolution plan.
“The appeal not only lacks merit, but is also frivolous. We have spent Rs 1 lakh on the appellant (DVI) while dismissing the appeal, which will be deposited in this Appellate Tribunal within 15 days, ”the NCLAT Bench chaired by Acting Chairman Justice BL Bhat said.
Earlier, the Chandigarh Bench of the National Company Law Tribunal (NCLT) approved the resolution plan submitted by DVI on 9 July last year for MTech Auto Limited.
While approving, NCLT in its order rendered the pre-condition by DVI LLP as disastrous for long term lease (20 years) of Ace Complex Land.
It was challenged by DVI LLP before the Appellate Tribunal that while approving its resolution plan, NCLT would go beyond its jurisdiction to conclude that the prior written consent of the pledgee of Ace Complex Limited is required in the resolution plan.
With PTI input