Chennai: Withdrawing the insolvency application against Dharani Sugars and Chemicals from the National Company Law Tribunal (NCLT) on Wednesday will mark the imminent revival of three sugar factories, reported The New Indian Express.
This action will relieve over 30,000 sugarcane growers in Vasudevanallur in the Tirunelveli district, Polur in the Tiruvannamalai district, and Sankarapuram in the Kallakurichi district.
According to a statement, the NCLT approved the proposal under 12A, reinstating power to the board of directors. The company faced losses from 2016 to 2019 due to consecutive rainfall failures and other factors. Consequently, the consortium of lenders’ loans remained unpaid, leading to the company’s entry into the Corporate Insolvency Resolution Process by the NCLT’s Chennai Bench in July 2021.
Despite challenges, the promoters have persistently worked towards revitalising the company by initiating payments to the banks. As part of these efforts, they have already paid 35% of the agreed amount to the consortium lenders and submitted a proposal under section 12A of the Insolvency and Bankruptcy Code (IBC) Rules to the committee of creditors. However, due to the inability to secure the remaining funds in time, the NCLT Chennai Bench issued liquidation orders for the company on March 18, 2023.
These liquidation orders were contested in the Supreme Court, which granted a stay on the orders on August 7, 2023.
