Essar Steel vs RBI: A timeline of events leading up to HC dismissing co's plea

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

On July 17, the Gujarat High Court dismissed Essar Steel's petition against the Reserve Bank of India (RBI). Essar Steel, which has debt of over Rs 40,000 crore, said they should have been given a chance to present their case before the release of the RBI circular as they have been in talks to resolve their debt issues.

Here's a timeline of events that led to the Gujarat HC decision  -

May 5 - The RBI received a go-ahead from the government to participate in bankruptcy proceedings by banks against debtors.

June 13 - The Reserve Bank of India identified 12 defaulters with bad loans summing up to over Rs 6.14 lakh crore.

June 16 - Bankers were sent the list of 12 defaulters that were to be resolved through the Insolvency and Bankruptcy Code (IBC). The five-fold IBC procedure is meant to help debt-ridden firms and business-persons to restructure funds and opt for insolvency resolution to maximise the value of assets.

July 4 - Essar Steel moved the Gujarat High Court against the insolvency proceedings initiated by its lenders. While the High Court issued a notice to the RBI the next day, the company put forth a plea seeking that RBI take into account its progress as well.

July 7 -  The first hearing of the case was held. The Gujarat HC heard Essar's plea demanding the RBI's five-member overseeing committee consider interest payments of Rs 3,500 crore and other signs of progress. The also asked to be brought under the second category, mentioned in the June 13 circular released by the RBI, who are given a six-month period to come clean. The HC restrained the National Company Law Tribunal (NCLT) from conducting any further proceeding against Essar Steel till they hear RBI's side of the story on July 12.

July 12 - The High Court heard RBI's argument where they had stated that Essar was very far from the loan restructuring process. The hearing was to be continued the next day where the RBI stuck to its earlier decision.

July 13 - The High Court asked RBI to submit the documents supporting their June 13 circular and said the hearing was postponed.

After Essar's plea was dismissed on Monday, the Court directed to restart the insolvency proceedings. Essar will now decide if it wants to further move the case to the Supreme Court. The decision is likely to be out in a day or two.