London: A UK High Court judge has refused to allow steel tycoon Lakshmi Mittal’s younger brother Pramod Mittal to appeal against the revocation of his IVA (Individual Voluntary Arrangement).
Mrs Justice Bacon, sitting in Chancery Appeal on Tuesday, said: “This application first went on paper before Justice Leach and in an order dated 6 March he dismissed the application for extensive reasons. It is renewed before me today. I do not agree that Leach has come to the wrong conclusion and disallowed the appeal.” There is no court that Mittal can turn to now and he will be bankrupt.
An IVA is a legally binding agreement between a debtor and creditors to pay all or part of the debt, while the bankruptcy trustee has very wide powers to investigate the debtor’s affairs. The IVA meant that Mittal would only have to return a fifth of each money owed to him to the creditors.
Mittal (66), an Indian national who lives in London, was declared bankrupt by the High Court on June 19, 2020, for failing to settle a judgment debt of 139 million pounds (Rs 1,428 crore) against him. After the stay, which is owed to Moorgate Industries. UK Limited. He proposed an IVA as an alternative to bankruptcy, which was approved by 75% by value of 20 creditors, many of whom were members of his family, at a creditors’ meeting on October 26, 2020. Moorgate voted against the IVA and then challenged it in the courts, seeking to repeal it. Moorgate would have only had to pay £250,000 (around Rs 2.6 crore) under the IVA.
Chief ICC Judge Briggs annulled the IVA on November 25, 2022, after finding material irregularities at the meeting of creditors.
On Tuesday, Ian Mayes Casey, representing Mittal, argued that Briggs should not have been found guilty of fraud and forgery against the subsidiary creditors as he was not cross-examined in the suit and was not a party to the case.
But Bacon said the judge found no fraud or forgery against him, but found the claimed debts could not be verified. “The creditors chose not to participate. The judge correctly found that it was for the creditors to establish their indebtedness and they have not done so,” she said.
John Sodden, director of Moorgate, told TOI after the court hearing: “The Court of Appeal has again emphatically rejected Mr Mittal’s appeal (his third unsuccessful attempt) against the revocation of the IVA, which was granted in October 2020 The opus was promoted by restructuring. It is clear that the IVA was based on bogus claims designed to reduce Moorgate’s claim to a minimum dividend
a fifth of every penny and enabled Mr. Mittal to avoid bankruptcy. We look forward to finally conducting a full investigation into all Mittal’s assets and affairs and recovery of Moorgate’s debt.