New Delhi [India], April 16 (ANI): The National Company Law Appellate Tribunal (NCLAT) on Thursday heard detailed submissions on behalf of Vedanta Limited challenging the approval of Adani Enterprises' Rs 14,535-crore resolution plan for Jaiprakash Associates Ltd (JAL), with the matter now slated for further hearing tomorrow.

Vedanta argued that the Committee of Creditors' (CoC) evaluation framework resulted in a "distorted outcome," where lower-value bids were ranked above its significantly higher offer exceeding Rs 17,000 crore.

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It contended that the scoring mechanism lacked transparency, consistency, and a clear linkage to value maximisation, thereby defeating the core objective of the insolvency process.

Vedanta further submitted that despite emerging as the highest bidder during the challenge process, the final assessment disregarded the identified criteria and reduced the exercise to a mechanical scoring process without substantive evaluation.

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It argued an absence of transparency in the scoring methodology, stating that there was no clear disclosure of how evaluation parameters were applied or how final scores were derived, particularly in relation to improved financial offers submitted during successive bidding rounds.

The invocation of "commercial wisdom" of COC in the present case was misplaced, as such discretion must demonstrably align with the objective of maximising stakeholder value. It submitted that no such linkage was evident in the final outcome.

It also challenged the rejection of its addendum on grounds of procedural constraints and timelines, stating that such considerations cannot override the statutory objective of value maximisation.

Highlighting its participation in multiple rounds of negotiations, Vedanta stated that it consistently improved its financial proposal in line with the prescribed challenge process, thereby contributing to price discovery.

The company further alleged that the CoC disproportionately relied on upfront cash as the determinative factor in evaluation, contrary to the stated criteria, which envisaged a composite assessment of value. This, it argued, distorted the intended framework. It reiterated that while the commercial wisdom of the CoC is generally accorded deference, it remains subject to scrutiny where exercised arbitrarily or in a manner inconsistent with the Insolvency and Bankruptcy Code's core objective of maximising realisable value for creditors.

The NCLAT is seized of Vedanta's appeal against the National Company Law Tribunal's March 17 order approving Adani Enterprises' bid for JAL. Vedanta has maintained that its revised proposal offered substantially higher value to creditors but was overlooked.

Earlier, the Supreme Court has declined to grant interim relief to Vedanta, noting that the NCLAT is already hearing the matter, however it safeguarded the interests of parties by making the resolution plan subject to the outcome of the appeals. The top court also urged expeditious disposal of the matter.

The appellate tribunal, after hearing the submissions, listed the matter for continuation of arguments tomorrow, when it will also hear the resolution professional of JAL. (ANI)

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