State Bank of India (NSEI:SBIN) has approached an appeals court to direct the Committee of Creditors (CoC) to reconsider its decision to accept a 95% collective haircut on the exposure. State Bank of India (SBI) is now seeking directions from the National Company Law Appellate Tribunal (NCLAT) to allow the resolution professional (RP) to invite a fresh expression of interest and a revised resolution plan. “Proceeding with the implementation of the resolution plan is not feasible since the same is not consistent with the observation made by the adjudicating authority (NCLT) and appellate tribunal and considering the totality of the fact emerging in the present case,” SBI said.

The country's biggest mass lender was responding to a petition filed by the dissenting financial creditor, Bank of Maharashtra, which has challenged the NCLT ruling. SBI has argued in its plea that it filed this petition on behalf of the assenting financial creditors that constitutes 94.98% in the CoC that approved the resolution plan submitted by Twin-Star Technologies Ltd. Twin Star is owned by Volcan Investments, a company of Vedanta Group promoter Anil Agarwal. Against admitted financial claims of INR 617.73 billion, the NCLT-approved resolution plan from the Vedanta Group firm was for a little over INR 30.00 billion.

“The CoC has filed this petition on the basis of the observation made by the NCLT but there is no such clause under which the clock can be turned back after the plan was approved by the lenders with an overwhelming majority and then by the tribunal,” said a person privy to the development. “There was no CoC meeting before moving this plea.” The plea filed by the SBI, through its assistant general manager, Ravi Shankar Prasad, further claimed that the assenting financial creditors, the majority of which are the public sector banks and financial institutions dealing with public money, have to give serious consideration and weightage to the observation of the adjudicating authority (NCLT) and appellate tribunal and propose to reconsider the decision in the larger public interest. In its 47-page ruling on June 9, NCLT while approving the Twin Star bid, had observed that creditors of Videocon Industries Limited (BSE:511389) will be taking nearly 96% haircut on their loans and the bidder is 'paying almost nothing'.

When contacted, a Twin Star spokesperson declined to comment. Mailed queries to SBI and Abhijit Guhathakurta, the resolution professional for the Videocon Group, remained unanswered. The consortium of 35 financial lenders had approved Twin Star Technologies' resolution plan with over 95% voting.