The National Company Law Tribunal (NCLT), Chennai, has said the entire corporate insolvency resolution process for Vasan Health Care Private Limited cannot be started afresh from the stage of issuance of expression of interest because it will upset the timelines prescribed under the Insolvency and Bankruptcy Code, 2016.
The NCLT’s observation came on a petition for extension of the time frame under the insolvency process.
In 2017, the NCLT ordered the start of insolvency proceedings against Vasan Health Care on a petition filed by Alcon Laboratories (India) Pvt. Ltd., one of its suppliers. However, the proceedings were stayed by a single judge of the Madras High Court. In October 2019, a Division Bench vacated the stay, and the case was back at the NCLT.
S. Rajendran, the resolution professional for Vasan Health Care, filed a plea for extension, citing the lockdown imposed in May 2021 and other factors like the change in the resolution professional.
‘Keen interest ‘
The petition also said the prospective bidders had expressed concerns over non-closure of the company’s accounts from 2018-19, licences and trade mark renewals. It said they had showed a keen interest in participating in the second round of expression of interest when floated.
The NCLT noted that the maximum time of 330 days allowed under the process was over and extension had already been allowed twice. Including the exclusions provided, more than 650 days had elapsed, it said.
Extension till August 22
It granted an extension only till August 22 to finalise the accounts of Vasan Health Care. After August 22, the NCLT said, the resolution professional could file a liquidation application based on its direction issued on February 26, 2021.
It said that even during the liquidation process, the committee of creditors could explore the opportunity to sell the company through a scheme contemplated under Section 230 of the Companies Act, 2013.
Creditors, including Andhra Bank, Edelweiss Asset Reconstruction, Kotak Mahindra Bank and HDFC Bank, have a claim totalling ₹1,268 crore against the company.
