IDBI gets no respite in Haldia Petro case

31-May-06

Delhi High Court has dismissed Industrial Development Bank of India’s (IDBI) appeal for a stay on the Company Law Board’s order that deferred allotment of shares by Haldia Petrochemicals to IDBI. Dismissing IDBI’s appeal, the division bench said it would hear the matter after the CLB takes a decision on the petition, final hearing for which is scheduled on July 4-6. IDBI’s earlier plea on the issue was rejected by a single bench of the court. Dispute arose between TCG and IDBI (the principal lender in a consortium of 52 financial institutions, lending Rs 3,500 crore to Haldia Petrochemicals) when HPL (which was making loss till the previous financial year) decided to allot shares worth Rs 135 crore to IDBI under the corporate debt restructuring package. The principal promoter The Chatterjee Group (TCG) objected to this allotment on the grounds that after the share allotment, they would lose their control over the refinery and moved the CLB to restrain allotment of HPL’s shares or ownership rights to IDBI.