NCLAT dismisses Vedanta's appeal against selection of Adani group's bid for Jaiprakash Associates

The National Company Law Appellate Tribunal (NCLAT) dismissed Vedanta's appeals against Adani Enterprises' resolution plan for Jaiprakash Associates, affirming the Committee of Creditors' commercial wisdom and the integrity of the insolvency process. The decision advances Adani's acquisition while Vedanta challenged metrics used in bid evaluation.

The National Company Law Appellate Tribunal (NCLAT) on Monday dismissed appeals filed by Vedanta Ltd challenging the selection of Adani Enterprises’ resolution plan for debt-ridden Jaiprakash Associates Ltd (JAL).

A two-member bench comprising Chairperson Ashok Bhushan and Member Technical Barun Mitra ruled that there were no valid grounds to interfere with the earlier decision of the National Company Law Tribunal (NCLT). The appellate tribunal stated that the appeals lacked merit and accordingly dismissed both petitions without any further orders.

In its judgment, the NCLAT emphasised that the Committee of Creditors (CoC) had exercised its "commercial wisdom" in selecting the resolution plan. It also noted that there was no material irregularity in the conduct of the insolvency process by the Resolution Professional.

Vedanta had contested the evaluation metrics used by lenders, arguing that its bid was significantly higher—by approximately Rs 3,400 crore in gross value and around Rs 500 crore in net present value—compared to Adani Enterprises’ offer. However, the tribunal rejected this argument, stating that the CoC’s decision to favour Adani’s bid could not be termed arbitrary or perverse despite the higher financial offer from Vedanta.

The dispute traces back to March 17, when the Allahabad bench of the NCLT approved Adani Enterprises’ Rs 14,535-crore resolution plan for Jaiprakash Associates. Vedanta subsequently challenged this decision before the NCLAT. Earlier, on March 24, the appellate tribunal had declined to grant an interim stay on the NCLT order, although it made the resolution subject to the final outcome of the appeals.

Vedanta also approached the Supreme Court seeking relief, but the apex court refused to stay the process. It, however, directed that any major policy decisions by the monitoring committee would require prior approval from the tribunal.

During the bidding process, Adani Enterprises secured the highest support from creditors, receiving 89 per cent of the votes, followed by Dalmia Bharat and Vedanta. The CoC maintained that the selection process adhered to all provisions of the Insolvency and Bankruptcy Code (IBC), highlighting that bids are assessed on multiple parameters such as upfront cash, feasibility, and execution capability, rather than just headline value.

Jaiprakash Associates, which was admitted into the Corporate Insolvency Resolution Process (CIRP) in June 2024, has total outstanding loans of Rs 57,185 crore. The company holds a diverse portfolio of assets, including real estate, cement manufacturing, hospitality, power, and engineering and construction businesses.

Its key real estate holdings include Jaypee Greens in Greater Noida, parts of Jaypee Greens Wishtown in Noida, and the Jaypee International Sports City near the upcoming Jewar International Airport. The company also owns commercial office spaces in the Delhi-NCR region, multiple hotel properties across North India, four cement plants in Madhya Pradesh and Uttar Pradesh, and leased limestone mines.

Additionally, Jaiprakash Associates has investments in several subsidiaries, including Jaiprakash Power Ventures Ltd, Yamuna Expressway Tolling Ltd, and Jaypee Infrastructure Development Ltd.

With the NCLAT verdict, Adani Enterprises’ acquisition of Jaiprakash Associates moves closer to completion, marking a significant development in one of India’s high-profile insolvency cases.