India’s bankruptcy court has admitted Sintex Plastics Technology under the Corporate Insolvency Resolution Process (CIRP), acting on an application filed by Asset Reconstruction Company (India) (ARC).
Last year the lender approached the Ahmedabad bench of the National Company Law Tribunal (NCLT) against the maker of underground and overhead water tanks after the company defaulted on its dues of about ₹250 crore.
“We hereby inform that a petition filed… against the company by Asset Reconstruction Company has been admitted against the company for which an order has been pronounced by the Ahmedabad bench on February 21, 2023,” the company said in a stock exchange announcement on Tuesday.
“Upon the written order being made available, an updated disclosure shall be made.”
In its latest annual results for 2021-22, Sintex Plastics Technology reported revenue of ₹96 lakh and a loss of about ₹144 crore.
“Since the petition has been filed by a financial creditor, the adjudicating authority (NCLT) will need to ascertain the existence of default within 14 days of an application being filed and once the default is established, the CIRP process shall commence from the date of admission of the application,” said Uday Ved, partner at the global tax practice and consulting group KNAV. “Subsequently, RP (resolution professional) will seek bids from interested bidders and allot the bid to the final winner of the bid. If the bid is successful, then the entire restructuring can be successful by going through the NCLT process.”
This is the fourth company of Gujarat-based Sintex Group to be admitted under the resolution process. Earlier, its wholly owned subsidiary Sintex BAPL Ltd was admitted under the insolvency resolution process.
The lenders have agreed to Welspun Group’s subsidiary-led resolution plan for Sintex BAPL’s revival and are awaiting the tribunal’s permission.
Sintex-BAPL is in the business of manufacturing injection moulded plastic components for the auto industry such as front and rear bumper systems, overhead systems and hood systems.
