Welspun Challenges Valor Estates' Bid for Lavasa Corp at NCLT
Welspun Group has filed a plea with the Mumbai NCLT seeking disqualification of top bidder Valor Estates in Lavasa Corp's debt resolution process. The plea cites Section 29A of the bankruptcy code, alleging Valor's ineligibility due to past defaults and family connections to defaulting entities. Allegations include links to Yash Jewellery, a non-performing asset, and issues with Valor's subsidiary. Valor maintains adherence to all guidelines. This legal challenge could potentially delay Lavasa Corp's debt resolution process significantly.
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In a significant development in the debt resolution process of Lavasa Corp, the Welspun Group has filed a plea with the Mumbai National Company Law Tribunal (NCLT) seeking the disqualification of top bidder Valor Estates. This move could potentially delay the resolution process for the troubled real estate company.
Legal Challenge Based on Bankruptcy Code
Welspun's plea cites Section 29A of the bankruptcy code, alleging that Valor Estates is ineligible to participate in the bidding process due to past defaults. The challenge revolves around the connections between Valor's leadership and other defaulting entities.
Allegations Against Valor Estates
The plea by Welspun Group makes several key allegations:
Family Connections: Pramod Goenka, brother of Valor chairman Vinod Goenka, is allegedly connected to Yash Jewellery, a defaulting company.
Non-Performing Asset: Yash Jewellery has been classified as a non-performing asset (NPA) since March 2014 and is currently under liquidation.
Personal Guarantees: Both Pramod and Vinod Goenka reportedly executed personal guarantees for loans taken by Yash Jewellery.
Subsidiary Issues: Goan Hotels & Realty, a subsidiary of Valor, was allegedly classified as an NPA for loans from Yes Bank.
Potential Implications
If the allegations are proven, they could potentially disqualify Valor Estates from the bidding process under the provisions of the bankruptcy code. This development threatens to complicate and potentially extend the debt resolution process for Lavasa Corp.
Valor's Response
Valor Estates maintains that it has adhered to all guidelines set forth in the bankruptcy code. The company states that it has made proper submissions to the resolution professional overseeing the process.
Industry Outlook
Industry sources suggest that this legal challenge could significantly impact the timeline of Lavasa Corp's debt resolution. There are concerns that the process could be delayed by years, further complicating the future of the troubled real estate project.
As the case unfolds at the NCLT, stakeholders in Lavasa Corp's resolution process will be closely watching the proceedings. The outcome of this challenge could have far-reaching implications for the interpretation and application of Section 29A of the bankruptcy code in future debt resolution cases.
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