The Supreme Court on Friday set aside the July 4 order of the NCLAT approving ArcelorMittal's Rs 42,000-crore bid for acquiring debt-laden Essar Steel.
A bench headed by Justice R F Nariman quashed the National Company Law Appellate Tribunal (NCLAT) order which had given financial creditors equal status with operational creditors in the distribution of ArcelorMittal's bid amount.
The said that that NCLAT cannot interfere with the decision of the committee of creditors (CoC).
"The decision of the CoC must reflect that it has taken into account and adequately balanced the interests of operational creditors," the apex court said.
The top court also relaxed the timeline of 330 days to find a resolution plan as prescribed under the Insolvency and Bankruptcy Code.
The bench clarified that financial creditors enjoy primacy and the adjudicating authority cannot interfere with the decision approved by the committee of creditors.
(With agency inputs)
