NCLT Mumbai Rules Against Wadhwa Buildcon's Resolution Plan Amidst Allegations of Misconduct and Lack of Disclosure

 


The National Company Law Tribunal (NCLT) in Mumbai said a plan by Wadhwa Buildcon's owner to deal with financial troubles wasn't acceptable. They found some problems with how the plan was approved, especially because the person behind the plan had been marked as someone who deliberately didn't pay debts.

 

The Bank of India brought the case, and they raised a few points. One big problem was that during the voting process, the banks lost a lot of their say in the decision-making, while homebuyers gained more power. The tribunal thought this change wasn't fair because homebuyers were mostly just interested in getting their flats, while the banks had more financial concerns.

 

The person who was in charge of sorting out the company's financial problems was also criticized. They were accused of delaying the plan and giving too much influence to homebuyers. Plus, they didn't tell the group of creditors that the person behind the plan had a history of not paying debts.

 

The court alleged this lack of disclosure was a big mistake since the creditors didn't have all the information they wanted to make a good decision. They also pointed out that a law that speaks to people who haven't paid their arrears on purpose shouldn't be permissible to come up with plans to solve financial problems.




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