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Essar’s CoC approves ArcelorMittal’s acquisition of Essar Steel

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Kolkata :ArcelorMittal on Friday announced that the Committee of Creditors (CoC) to Essar Steel India Limited (ESIL) has voted in favour of the company’s acquisition.

ESIL’s resolution professional (RP), on behalf of the CoC, has issued the company with a Letter of Intent (LOI) stating that the company has been identified as the successful applicant.

The resolution plan, as disclosed by Arcelor, includes an upfront payment of Rs 420 billion towards ESIL’s resolution debt, with a further Rs 80 billion capital injection into ESIL to support operational improvement, increase production levels and deliver enhanced levels of profitability.

 

Arcelor plans to increase ESIL’s finished steel shipments to 8.5 million tonnes over the medium-term. The long-term aspiration was to increase shipments to 12 and 15 million tonnes through the addition of new iron and steelmaking assets.

ESIL’s current level of annualised crude steel production is 6.5 million tonnes. ESIL also has iron ore pellet facilities in the east of India with a current annual capacity of 14 million tonnes per annum.

Arcelor will jointly own and operate ESIL in partnership with Nippon Steel & Sumitomo Metal Corporation (NSSMC). Arcelor and NSSMC expect to finance the joint venture through a combination of partnership equity (one-third) and debt (two-third) and Arcelor anticipates that its investment in the joint venture will be equity accounted.

Nippon believes that, by bringing together the strengths of both companies, NSSMC and AM (ArcelorMittal) will be able to turn around ESIL to be a competitive steel manufacturer and contribute to further development of Indian steel industry and Indian economy, the company said.

Voting on the ArcelorMittal plan which concluded on Thursday secured more than 92 per cent of the CoC’s voting share.

A lender said that the letter of intent was issued in favour of Arcelor Thursday night and the company had accepted it. The resolution plan is expected to be filed with the NCLT shortly.

In a surprise move, however, the Ruias of Essar Steel made an offer to the CoC after the conclusion of the voting, to settle the entire claims of Rs 543 billion under Section 12A of the IBC. It allows a company to exit the bankruptcy process if it offers to repay the dues and 90 per cent of the lenders accept the proposal.

“The courts will take a view on the offer,” the lender said. The legal battle in the Essar case is likely to continue.


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Income Tax return processing time to reduce from 63 days to just 1 day

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Mumbai:The Union Cabinet approved an integrated income-tax e-filing and centralised processing centre (CPC) portal, which will reduce the return processing time from 63 days to just one day. The new portal is also expected to process the refunds within one day of filing of tax returns, in huge relief for taxpayers. However, one will have to wait for 18 months to see its launch.

“Earlier, taxpayers would face troubles because of delay in refund processing and the CBDT used to spend a lot of money every year as interest on pending refunds, which will be history now,” Union minister Piyush Goyal told reporters after the Cabinet meeting here.

Last month, Central Board of Direct Taxes (CBDT) Chairman Sushil Chandra had said a simplified return form and process would be put in place soon in which the department would process the self-declaration made by the taxpayer. The new Rs 4,241-crore project will incorporate these changes.

 

“This is a laudable initiative and will go a long way to ease tax compliance, and enhanced experience for taxpayers. However, the real success of this will be measured when it brings ease to a common man and is accompanied by changes in the culture of the tax authorities at the operational level,” said Neeru Ahuja, partner, Deloitte India.

Currently, the e-filing portal and the CPC work separately. While e-filing is being managed by Tata Consultancy Services (TCS), the CPC is run by Infosys.

In the bids invited by the government, Infosys emerged as the lowest bidder and it would develop the ITR-CPC 2.0 project in 18 months from now, Goyal said.

Under the new system, Infosys will handle end-to-end solution — from e-filing to return assessment to refund processing. The CBDT and Infosys would work in a revenue-sharing model, sources in the know said.

Goyal said ramping up scrutiny was not the mandate of the new portal. Currently, about 0.3 per cent of the I-T returns are scrutinised, he said. The system intends to resolve taxpayer grievances as well as tax demands from the CBDT faster and equitably, he said.

“The decision will ensure horizontal equity by processing returns filed by all categories of taxpayers across the country in a consistent, uniform, rule driven, identity blind manner. This will assure fairness in tax treatment to every taxpayer irrespective of their status,” a government release said.

But even under the new ecosystem, only those applications which are clean would have the chance of getting processed in a day, sources said.

About 23 crore I-T returns have been processed, along with Rs 2.62 trillion worth of refunds, till September 2018 cumulatively. Of this, refunds worth Rs 1.83 trillion have been processed in 2018-19, said Goyal.

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Lenders considering resolution plan for Jet Airways: SBI

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Mumbai: State Bank of India (SBI) on Thursday said lenders are considering a resolution plan for Jet Airways to ensure long-term viability of the debt-laden company.

The SBI statement comes a day after the crisis-hit airline said discussions were “progressing well” with stakeholders on a comprehensive resolution plan that also contemplates equity infusion and consequent changes in its board of directors.

There are rising concerns over financial health of Jet Airways, whose shares have also taken a beating at stock exchanges.

 

“We would like to state that lenders are considering a restructuring plan under the RBI framework for resolution of stressed assets that would ensure a long-term viability of the company,” SBI said in a statement.

It said the restructuring plan for the cash-strapped airline would need approval from boards of lenders.

“Any such plan would be subject to approval of boards of the lenders and subject to adherence and clearance, if required, from the RBI and/or Sebi (takeover code, ICDR regulations.) and Ministry of Civil Aviation and in compliance with all regulatory prescriptions,” the statement said.

Shares of the airline are trading 4.24 per cent lower at Rs 259.50 apiece on BSE.

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NGT slams Volkswagen for not depositing Rs 100 crore as per its 2018 order

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New Delhi: The National Green Tribunal (NGT) slammed German auto major Volkswagen for not depositing Rs 100 crore in accordance with its November 16, 2018 order and directed it to submit the amount within 24 hours.

A bench headed by NGT chairperson Adarsh Kumar Goel took strong exception to the non-compliance of its order by the automobile giant and asked it to give an undertaking that it will submit the amount by 5 PM Friday.

“Why have you not complied with our order when there is no stay. We will not give you any further time,” the bench, also comprising Justice S P Wangdi, said while asking Volkswagen to submit an affidavit of compliance after deposit.

 

The tribunal deferred the matter for hearing after it was informed that the Supreme Court is also seized of the issue.

On November 16 last year, the tribunal had said that the use of ”cheat device” by Volkswagen in diesel cars in India leads to inference of environmental damage and had asked the German auto major to deposit an interim amount of Rs 100 crore with the Central Pollution Control Board (CPCB).

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