Case: ARCELOR MITTAL INDIA PRIVATE LIMITED Vs. SATISH KUMAR GUPTA

of the said regulations. Also, as a matter of fact, the sale of the said shares was effected without taking the consent of the lenders of Uttam Galva, which consent was necessary as per the Non Disclosure Undertaking that was executed by AMNLBV. On 7.2.2018, consequent to the aforesaid inter se transfer, the Co-Promotion Agreement is said to have stood automatically terminated. By way of abundant caution, a formal deed of termination was entered into. AMNLBV addressed letters to the NSE and the BSE to record the aforesaid inter se transfer, who accordingly declassified AMNLBV as a promoter of Uttam Galva on 21.3.2018 and 23.3.2018 respectively. 109. It is absolutely clear that Shri L.N. Mittal, who is the ultimate shareholder of the resolution applicant, viz. AMIPL, is directly the ultimate shareholder of AMNLBV as well, which is an L.N. Mittal Group Company. When the corporate veil of the various companies aforementioned is pierced, both AMIPL and AMNLBV are found to be managed and controlled by Shri L.N. Mittal, and are therefore persons deemed to be acting in concert as per Regulation 2(1)(q)(2)(i) of the 2011 Takeover Regulations. That AMNLBV is a promoter of Uttam Galva is clear from the aforementioned facts, being expressly stated as such in Uttam Galva?s annual returns. The reasonably proximate facts prior to the submission of both resolution plans by AMIPL would show that there is no doubt whatsoever that AMNLBV?s shares in Uttam Galva were sold only in order to get out of the ineligibility mentioned by Section 29A(c), and consequently the proviso thereto. The fact that the lenders with whom AMNLBV had a Non Disposal Undertaking have not yet moved any forum for a declaration that the sale of the shares, being without their consent, is non est, does not absolve AMNLBV from having failed to first obtain their consent before selling off its shares in Uttam Galva. Such sale is directly contrary to the Non Disposal Undertaking given to the lenders. Quite apart from this, it is also clear that shares worth Rs.19.50 each were sold at a distress value of Re.1 each, so as to overcome the provisions of Section 29A(c) and the proviso thereto. It is clear therefore that the Uttam Galva transaction clearly renders AMIPL ineligible under Section 29A(c) of the Code. 110. Insofar as the transaction with regard to KSS Petron is concerned, the facts are as follows:- on 3.3.2011, Fraseli, an entity registered and incorporated in Luxemburg, which is managed and controlled by Shri L.N. Mittal, held 32.22% of the shareholding of KSS Global, a company domiciled in the Netherlands. On 19.5.2011, by a Shareholders Agreement entered into between KSS Holding, KSS Infra EALQ, Fraseli and KSS Global, the first three companies were each given a right to appoint an equal number of directors on the board of directors of KSS Global, which in turn held 100% of the share capital of KSS Petron, a company incorporated in India. Fraseli was also granted affirmative voting rights on decisions regarding certain specified matters, both at the board and the shareholder level, in respect of KSS Global and all companies controlled by it, which would include KSS Petron. As has been stated hereinabove, KSS Petron was declared as an NPA on 30.9.2015. As in the case of Uttam Galva, Fraseli divested its shareholding in KSS Petron on 9.2.2018, i.e., only three days before AMIPL submitted its first resolution plan. On the same day, the directors nominated by Shri L.N. Mittal, through Fraseli, resigned from the board of KSS Global. 111. From the aforementioned facts, there can be no doubt whatsoever that Fraseli, being a company managed and controlled by Shri L.N. Mittal, holding one third of the shares in KSS Global, which in turn held 100% of the share capital in KSS Petron, was in joint control of KSS Petron, if the corporate veil of all these companies is disregarded. Further, the Shareholders Agreement of 19.5.2011 makes it clear that the joint control of KSS Global would be between three entities, viz., KSS Holding, KSS Infra EALQ and Fraseli, each of whom had the right to appoint an equal number of directors on the board of directors of KSS Global. Not only this, but Fraseli was also granted affirmative voting rights as aforementioned, on certain important specified matters. There would be no doubt whatsoever that, just before presentation of the resolution plan of 12.2.2018, AMIPL would be hit by Section 29A(c), as a group company of Shri L.N. Mittal exercised positive control, by its shareholding, right to appoint directors and affirmative voting rights, over KSS Global, which in turn held 100% shareholding in KSS Petron. Again, as in the case of Uttam Galva, there can be no doubt whatsoever that the sale of Fraseli?s shareholding in KSS Global, together with the resignation of the Mittal directors from the board of directors of KSS Global, is a transaction reasonably proximate to the date of submission of the resolution plan by AMIPL, undertaken with the sole object of avoiding the consequence mentioned in the proviso to Section 29A(c). Having regard to the law laid down by us in this judgment, it is, therefore, clear that AMIPL is ineligible under Section 29A(c) of the Code, on this account as well. 112. Shri Rohatgi also argued before us that Shri Pramod Mittal, brother of Shri Laxmi Mittal, also held shares in two other companies which were declared to be NPAs more than one year prior to the date of commencement of the corporate insolvency resolution process of ESIL. We have been informed by Shri Salve that Shri Pramod Mittal parted company with Shri L.N. Mittal as far back as 1994, and cannot therefore be regarded as a person acting in concert with Shri L.N. Mittal. Since this aspect of the case has not been argued before the authorities below, though raised in an I.A. by Numetal before the Appellate Authority, we will not countenance such an argument for the first time before this Court.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]34. It is thus clear that, where a statute itself lifts the corporate veil, or where protection of public interest is of paramount importance, or where a company has been formed to evade obligations imposed by the law, the court will disregard the corporate veil. Further, this principle is applied even to group companies, so that one is able to look at the economic entity of the group as a wholeWe are afraid that these judgments are wholly inapplicable. All that is to be seen by the expression ?acting jointly? is whether certain persons have got together and are acting ?jointly? in the sense of acting together. If this is made out on the facts, no super added element of ?joint venture? as is understood in law is to be seen. The other important phrase is ?in concert?. By Section 3(37) of the Code, words and expressions used but not defined in the Code but defined inter alia by the SEBI Act, 1992, and the Companies Act, 2013, shall have the meanings respectively assigned to them in those Acts. In exercise of powers conferred by Sections 11 and 30 of the SEBI Act, 1992, the 2011 Takeover Regulations have been promulgated by SEBI43. According to us, it is clear that the opening words of Section 29A furnish a clue as to the time at which sub-clause (c) is to operate. The opening words of Section 29A state:?a person shall not be eligible to submit a resolution. It is clear therefore that the stage of ineligibility attaches when the resolution plan is submitted by a resolution applicant. The contrary view expressed by Shri Rohatgi is obviously incorrect, as the date of commencement of the corporate insolvency resolution process is only relevant for the purpose of calculating whether one year has lapsed from the date of classification of a person as a non- performing asset. Further, the expression used is ?has?, which as Dr. Singhvi has correctly argued, is in praesenti. This is to be contrasted with the expression ?has been?, which is used in sub- clauses (d) and (g), which refers to an anterior point of time. Consequently, the amendment of 2018 introducing the words ?at the time of submission of the resolution plan? is clarificatory, as this was always the correct interpretation as to the point of time at which the disqualification in sub-clause (c) of Section 29A will attach44. The ingredients of sub-clause (c) are that, the ineligibility to submit a resolution plan attaches if any person, as is referred to in the opening lines of Section 29A, either itself has an account, or is a promoter of, or in the management or control of, a corporate debtor which has an account, which account has been classified as a non-performing asset, for a period of at least one year from the date of such classification till the date of commencement of the corporate insolvency resolution process. For the purpose of applying this sub-section, any one of three things, which are disjunctive, needs to be established. The corporate debtor may be under the management of the person referred to in Section 29A, the corporate debtor may be a person under the control of such person, or the corporate debtor may be a person of whom such person is a promoter54. The interpretation of Section 29A(c) now becomes clear. Any person who wishes to submit a resolution plan, if he or it does so acting jointly, or in concert with other persons, which person or other persons happen to either manage or control or be promoters of a corporate debtor, who is classified as a non-performing asset and whose debts have not been paid off for a period of at least one year before commencement of the corporate insolvency resolution process, becomes ineligible to submit a resolution plan. This provision therefore ensures that if a person wishes to submit a resolution plan, and if such person or any person acting jointly or any person in concert with such person, happens to either manage, control, or be promoter of a corporate debtor declared as a non-performing asset one year before the corporate insolvency resolution process begins, is ineligible to submit a resolution plan. The first proviso to sub-clause (c) makes it clear that the ineligibility can only be removed if the person submitting a resolution plan makes payment of all overdue amounts with interest thereon and charges relating to the non-performing asset in question before submission of a resolution plan. The position in law is thus clear. Any person who wishes to submit a resolution plan acting jointly or in concert with other persons, any of whom may either manage, control or be a promoter of a corporate debtor classified as a non-performing asset in the period abovementioned, must first pay off the debt of the said corporate debtor classified as a non-performing asset in order to become eligible under Section 29A(c)We are afraid that we cannot accept the aforesaid submission. The plain language of the proviso makes it clear, that ineligibility can only be removed if the necessary payment is made before submission of a resolution plan. It is not possible to accede to the argument that, commercially speaking, no person would ever make a speculative bid, where he would pay off the debt of another related corporate debtor, classified as an NPA, without being certain that his resolution plan would be accepted, as this would narrow the pool of resolution applicants to nil, and therefore stultify the object sought to be achieved by the proviso to Section 29A(c). First, it is clear that there may be persons who may submit resolution plans, either by themselves, or in concert, or jointly with other persons who do not have debts which are declared as NPAs. Also, it is very difficult to say that in no circumstance whatsoever would a person submitting a resolution plan pay off the NPA dues of another person, with whom it is acting in concert or jointly. The dues may be such that it may be worth the while of the person, together with the persons with whom he is acting in concert or jointly, to first pay off the dues of the concerned corporate debtor whose account has been declared to be an NPA, as such dues may be negligible when compared with the gaining of control of the corporate debtor that is sought to be run as a going concern as per a resolution plan submitted. It is, therefore, impossible to say that the plain, literal, meaning of the language used by the proviso leads to absurdity or hardship. This interpretation is also in line with the object sought to be achieved, namely, that other corporate debtors who are declared as NPAs, whose debts may never be cleared in full, are required to be cleared as a condition precedent to submission of a resolution plan under the Code. In order, therefore, to make the statute ?workable?, as is suggested by Messrs Salve and Singhvi, we cannot disregard the plain language of the proviso and substitute words which would have the opposite effect57. It is important for the competent authority to see that persons, who are otherwise ineligible and hit by sub-clause (c), do not wriggle out of the proviso to sub-clause (c) by other means, so as to avoid the consequences of the proviso. For this purpose, despite the fact that the relevant time for the ineligibility under sub- clause (c) to attach is the time of submission of the resolution plan, antecedent facts reasonably proximate to this point of time can always be seen, to determine whether the persons referred to in Section 29A are, in substance, seeking to avoid the consequences of the proviso to sub-clause (c) before submitting a resolution plan. If it is shown, on facts, that, at a reasonably proximate point of time before the submission of the resolution plan, the affairs of the persons referred to in Section 29A are so arranged, as to avoid paying off the debts of the non-performing asset concerned, such persons must be held to be ineligible to submit a resolution plan, or otherwise both the purpose of the first proviso to sub-section (c) of Section 29A, as well as the larger objective sought to be achieved by the said sub-clause in public interest, will be defeated59. In the light thereof, it is clear that if a person is prohibited by a regulator of the securities market in a foreign country from trading in securities or accessing the securities market, the disability under sub-clause (i) would then attach70. The time limit for completion of the insolvency resolution process is laid down in Section 12. A period of 180 days from the date of admission of the application is given by Section 12(1). This is extendable by a maximum period of 90 days only if the Committee of Creditors, by a vote of 66%, votes to extend thesaid period, and only if the Adjudicating Authority is satisfied that such process cannot be completed within 180 days. The authority may then, by order, extend the duration of such process by a maximum period of 90 days (see Sections 12(2) and 12(3)). What is also of importance is the proviso to Section 12(3) which states that any extension of the period under Section 12 cannot be granted more than once. This has to be read with the third proviso to Section 30(4), which states that the maximum period of 30 days mentioned in the second proviso is allowable as the only exception to the extension of the aforesaid period not being granted more than once71. What is important to note is that a consequence is provided, in the event that the said period ends either without receipt of a resolution plan or after rejection of a resolution plan under Section 31. This consequence is provided by Section 33, which makes it clear that when either of these two contingencies occurs, the corporate debtor is required to be liquidated in the manner laid down in Chapter III. Section 12, construed in the light of the object sought to be achieved by the Code, and in the light of the consequence provided by Section 33, therefore, makes it clear that the periods previously mentioned are mandatory and cannot be extended72. In fact, even the literal language of Section 12(1) makes it clear that the provision must read as being mandatory. The expression ?shall be completed? is used. Further, sub-section (3) makes it clear that the duration of 180 days may be extended further ?but not exceeding 90 days?, making it clear that a maximum of 270 days is laid down statutorily. Also, the proviso to Section 12 makes it clear that the extension ?shall not be granted more than once?It is settled law that a statute is designed to be workable, and the interpretation thereof should be designed to make it so workable76. Given the timeline referred to above, and given the fact that a resolution applicant has no vested right that his resolution plan be considered, it is clear that no challenge can be preferred to the Adjudicating Authority at this stage. A writ petition under Article 226 filed before a High Court would also be turned down on the ground that no right, much less a fundamental right, is affected at this stage. This is also made clear by the first proviso to Section 30(4), whereby a Resolution Professional may only invite fresh resolution plans if no other resolution plan has passed muster78. Thus, the importance of the Resolution Professional is to ensure that a resolution plan is complete in all respects, and to conduct a due diligence in order to report to the Committee of Creditors whether or not it is in order. Even though it is not necessary for the Resolution Professional to give reasons while submitting a resolution plan to the Committee of Creditors, it would be in the fitness of things if he appends the due diligence report carried out by him with respect to each of the resolution plans under consideration, and to state briefly as to why it does or does not conform to the lawAs has been mentioned hereinabove, the first proviso to Section 30(4) furnishes the answer, which is that all that can happen at this stage is to require the Resolution Professional to invite a fresh resolution plan within the time limits specified where no other resolution plan is available with him. It is clear that at this stage again no application before the Adjudicating Authority could be entertained as there is no vested right or fundamental right in the resolution applicant to have its resolution plan approved, and as no adjudication has yet taken placeThis regulation shows that the disapproval of the Committee of Creditors on the ground that the resolution plan violates the provisions of any law, including the ground that a resolution plan is ineligible under Section 29A, is not final. The Adjudicating Authority, acting quasi-judicially, can determine whether the resolution plan is violative of the provisions of any law, including Section 29A of the Code, after hearing arguments from the resolution applicant as well as the Committee of Creditors, after which an appeal can be preferred from the decision of the Adjudicating Authority to the Appellate Authority under Section 6181. If, on the other hand, a resolution plan has been approved by the Committee of Creditors, and has passed muster before the Ad- judicating Authority, this determination can be challenged before the Appellate Authority under Section 61, and may further be chal- lenged before the Supreme Court under Section 62, if there is a question of law arising out of such order, within the time specified in Section 62. Section 64 also makes it clear that the timelines that are to be adhered to by the NCLT and NCLAT are of great im- portance, and that reasons must be recorded by either the NCLT or NCLAT if the matter is not disposed of within the time limit spec- ified. Section 60(5), when it speaks of the NCLT having jurisdiction to entertain or dispose of any application or proceeding by or against the corporate debtor or corporate person, does not invest the NCLT with the jurisdiction to interfere at an applicant?s behest at a stage before the quasi-judicial determination made by the Ad- judicating Authority. The non-obstante clause in Section 60(5) is designed for a different purpose: to ensure that the NCLT alone has jurisdiction when it comes to applications and proceedings by or against a corporate debtor covered by the Code, making it clear that no other forum has jurisdiction to entertain or dispose of such applications or proceedings84. Coming to the facts of the present case, let us first examine the resolution plan presented by Numetal. Numetal was incorporated in Mauritius on 13.10.2017, expressly for the purposeof submission of a resolution plan qua the corporate debtor, i.e., ESIL. Two other companies, viz., AHL and AEL, were also incorporated on the same day in Mauritius. Shri Rewant Ruia, son of Shri Ravi Ruia (who was the promoter of ESIL) held the entire share capital of AHL, which in turn held the entire shareholding of AEL, which in turn held the entire share capital of Numetal. At this stage there can be no doubt whatsoever that Shri Rewant Ruia, being the son of Shri Ravi Ruia, would be deemed to be a person acting in concert with the corporate debtor, being covered by Regulation 2(1)(q)(v) of the 2011 Takeover Regulations88. The Resolution Professional, after looking at this affidavit, correctly noted that statements of such a nature would not have been made by a truly independent trustee of a discretionary trust, which demonstrates that the trustee was under the complete control of Shri Rewant Ruia. This in turn indicates that Prisma Trust is one more smokescreen in the chain of control, which would conceal the fact that the actual control over AEL is by none other than Shri Rewant Ruia himselfIt is important to note that, as of this date, Shri Rewant Ruia, who is the ultimate beneficiary in the chain of control of the trusts which in turn controlled AEL, was very much on the scene, holding through AEL 25% of the shareholding of Numetal91. One other extremely important fact needs to be noticed at this stage. The earnest money in the form of Rs. 500 crores, credited to the account of the corporate debtor, has been provided to Numetal by AEL as a shareholder of the resolution applicant, viz. Numetal. It is important to note that this earnest money deposit of Rs.500 crores made by AEL continues to remain with the Resolution Professional till date, despite the fact that, by the time the second resolution plan was submitted by Numetal on 2.4.2018, AEL had exited as a shareholder of Numetal. It is also important to note that under clause 4.4.4 of the request for proposal for submission of resolution plans for ESIL, the earnest money deposit stands to be forfeited if any condition thereof is breached or the qualifications of the potential resolution applicant are found to be untrue93. The excerpted portions of Numetal?s resolution plan make it clear that, since Numetal itself was a newly incorporated entity, with no financial or experience credentials of its own, it therefore relied entirely on the credentials of each of its constituent shareholders. This shows that Numetal itself revealed in its resolution plan that its corporate veil should be lifted, for without lifting this veil, none of the parameters of the request for proposal could have been met by Numetal itself. It is thus clear that the four shareholders of Numetal were persons ?acting jointly? within the meaning of Section 29A. This being the case, it is clear that Shri Salve?s argument that VTB Bank is a ?connected person?, being ineligible under sub-clause (j), would have to be rejected, as VTB Bank is itself, through its wholly owned subsidiary of Crinium Bay, a person acting jointly with the three other shareholders of Numetal, and would, therefore, fall within the first part of Section 29A itself. This being so, it cannot be said that VTB Bank is a person ?connected to? any one of the persons acting jointly, as it is itself a person acting jointly, and therefore covered by the first part of Section 29A94. It is important to note that on 29.3.2018, AEL transferred its 25% shareholding in Numetal to the other three constituent shareholders, thereby leaving its shareholding in Numetal as ‘Nil?. In response to the Resolution Professional?s invitation, the second Resolution Plan, therefore, submitted by Numetal on 2.4.2018, did not have AEL as a constituent of Numetal; instead, Crinium Bay continued with 40% of the shareholding of Numetal, with TPE?s holding now augmented to 29.5% and Indo?s to 34.1%95. Given the fact that Shri Rewant Ruia is a person deemed to be acting in concert with his father Shri Ravi Ruia (who was a promoter of the corporate debtor ESIL), there is no doubt whatsoever that Section 29A(c) would be attracted as on the date of submission of the first resolution plan, viz. 12.2.2018, as AEL was held by Prisma Trust, whose ultimate beneficiary is Shri Rewant Ruia himself. This would show that the NPA declared over a year before the date of commencement of the corporate resolution process of ESIL (i.e. in 2015) would render Numetal ineligible to submit a resolution plan. The only manner in which Numetal could successfully present a resolution plan would be to first pay off the debts of ESIL, as well as those of such other corporate debtors of the Ruia group of companies, which were declared as NPAs prior to the aforesaid period of one year, before submitting its resolution plan. However, if the date of the second resolution plan is to be seen, Shri Rewant Ruia appears to have disappeared from the scene altogether, as the three entities left are stated to be independent entities in the form of two Russian entities and one UAE entity. Viewed on 2.4.2018, therefore, could it be said that Shri Rewant Ruia had disappeared from the scene altogether, so as to obviate the application of Section 29A(c)? The obvious answer is no. This is for two reasons. First, as has been stated earlier, the Rs.500 crores that has been deposited towards submission of earnest money continues to remain deposited by AEL even post 2.4.2018, showing thereby that Shri Rewant Ruia continues to be present, insofar as Numetal?s second resolution plan is concerned. Further, having regard to the reasonably proximate state of affairs before submission of the resolution plan on 2.4.2018, beginning with Numetal?s initial corporate structure, and continuing with the changes made till date, it is evident that, the object of all the transactions that have taken place after Section 29A came into force on 23.11.2017 is undoubtedly to avoid the application of Section 29A(c), including its proviso. We therefore hold that, whether the first or second resolution plan is taken into account, both would clearly be hit by Section 29A(c), as the looming presence of Shri Rewant Ruia has been found all along, from the date of incorporation of Numetal, till the date of submission of the second resolution plan103. What will be noticed is that the sanctions that have been imposed by the authorities of both the United States and the Council of the European Union are not on account of any misconduct on the part of VTB Bank. Rather, they have been imposed politically, because of the conduct of a particular country, i.e. Russia, which has sought to undermine Ukraine?s territorial integrity, sovereignty and independence, by illegally annexing Crimea and Sevastopol. We are of the view that Shri Rohatgi is right, inasmuch as VTB Bank cannot be said to have been prohibited by an authority outside India from trading in securities or accessing the securities markets, due to any fraudulent and/or unfair trade practices relating to the securities market generally. A prohibitory sanction by an authority situate outside India for political reasons would thus not be covered by sub-clause (i)105. A reading of this order makes it clear that, even assuming that the Commodity Futures Trading Commission is an authority which corresponds with SEBI (Shri Rohatgi has argued that in the United States the Securities Exchange Commission is the authority which corresponds with SEBI in India), it is clear that there is no prohibition by the Commodity Futures Trading Commission of the United States interdicting VTB Bank from trading in securities or accessing the securities market. All that VTB Bank has done is consent to a cease and desist order; consent to pay a monetary penalty in the amount of USD five million; and further consent to not enter into privately negotiated futures options with a particular subsidiary, viz. VTB Capital, on or through any US-based futures exchange for a period of two years from the date of the order. Obviously, a prohibition regarding privately negotiated futures options, or combination transactions with one another, is not a prohibition from trading in securities or accessing the securities market. We thus agree with Shri Rohatgi that Crinium Bay, being a wholly owned subsidiary of VTB Bank, does not therefore incur any disqualification under sub-clause (f) read with sub-clause (i) of Section 29AIt is important to note that, in all the annual returns of Uttam Galva till date, AMNLBV?s shareholding has been shown as ‘promoter?s shareholding.? All the annual reports, upto 2017, contained a list of promoters, which included AMNLBV as one such, holding 29.05%% of the share capital of the company, and having significant influence over the company. Shri Salve?s argument that, in point of fact, no control was actually exercised as AMNLBV never appointed any directors or exercised its voting rights, cannot be accepted as that makes no difference to the de jure position of AMNLBV being a ?promoter? as defined in Section 2(69)(a) of the Companies Act, 2013108. On 7.2.2018, a few days before AMIPL submitted its first resolution plan, AMNLBV sold its entire shareholding in Uttam Galva by way of an off market sale, to a company of the Indian co- promoters, viz., ‘Sainath Trading Company Private Limited?. Shares that were purchased for Rs.120 each, were sold for Re.1 each, when the market value of the shares on the said date was admittedly Rs.19.50 per share. The aforesaid sale of shares was done without making an open offer under the 2011 Takeover Regulations, on the basis that it was an inter se transfer of shares between promoters, and therefore exempt from such requirement under Regulation 10 of the said regulations. Also, as a matter of fact, the sale of the said shares was effected without taking the consent of the lenders of Uttam Galva, which consent was necessary as per the Non Disclosure Undertaking that was executed by AMNLBV. On 7.2.2018, consequent to the aforesaid inter se transfer, the Co-Promotion Agreement is said to have stood automatically terminated. By way of abundant caution, a formal deed of termination was entered into. AMNLBV addressed letters to the NSE and the BSE to record the aforesaid inter se transfer, who accordingly declassified AMNLBV as a promoter of Uttam Galva on 21.3.2018 and 23.3.2018 respectively109. It is absolutely clear that Shri L.N. Mittal, who is the ultimate shareholder of the resolution applicant, viz. AMIPL, is directly the ultimate shareholder of AMNLBV as well, which is an L.N. Mittal Group Company. When the corporate veil of the various companies aforementioned is pierced, both AMIPL and AMNLBV are found to be managed and controlled by Shri L.N. Mittal, and are therefore persons deemed to be acting in concert as per Regulation 2(1)(q)(2)(i) of the 2011 Takeover Regulations. That AMNLBV is a promoter of Uttam Galva is clear from the aforementioned facts, being expressly stated as such in Uttam Galva?s annual returns. The reasonably proximate facts prior to the submission of both resolution plans by AMIPL would show that there is no doubt whatsoever that AMNLBV?s shares in Uttam Galva were sold only in order to get out of the ineligibility mentioned by Section 29A(c), and consequently the proviso thereto. The fact that the lenders with whom AMNLBV had a Non Disposal Undertaking have not yet moved any forum for a declaration that the sale of the shares, being without their consent, is non est, does not absolve AMNLBV from having failed to first obtain their consent before selling off its shares in Uttam Galva. Such sale is directly contrary to the Non Disposal Undertaking given to the lenders. Quite apart from this, it is also clear that shares worth Rs.19.50 each were sold at a distress value of Re.1 each, so as to overcome the provisions of Section 29A(c) and the proviso thereto. It is clear therefore that the Uttam Galva transaction clearly renders AMIPL ineligible under Section 29A(c) of the Code110. Insofar as the transaction with regard to KSS Petron is concerned, the facts are as follows:- on 3.3.2011, Fraseli, an entity registered and incorporated in Luxemburg, which is managed and controlled by Shri L.N. Mittal, held 32.22% of the shareholding of KSS Global, a company domiciled in the Netherlands. On 19.5.2011, by a Shareholders Agreement entered into between KSS Holding, KSS Infra EALQ, Fraseli and KSS Global, the first three companies were each given a right to appoint an equal number of directors on the board of directors of KSS Global, which in turn held 100% of the share capital of KSS Petron, a company incorporated in India. Fraseli was also granted affirmative voting rights on decisions regarding certain specified matters, both at the board and the shareholder level, in respect of KSS Global and all companies controlled by it, which would include KSS Petron. As has been stated hereinabove, KSS Petron was declared as an NPA on 30.9.2015. As in the case of Uttam Galva, Fraseli divested its shareholding in KSS Petron on 9.2.2018, i.e., only three days before AMIPL submitted its first resolution plan. On the same day, the directors nominated by Shri L.N. Mittal, through Fraseli, resigned from the board of KSS Global111. From the aforementioned facts, there can be no doubt whatsoever that Fraseli, being a company managed and controlled by Shri L.N. Mittal, holding one third of the shares in KSS Global, which in turn held 100% of the share capital in KSS Petron, was in joint control of KSS Petron, if the corporate veil of all these companies is disregarded. Further, the Shareholders Agreement of 19.5.2011 makes it clear that the joint control of KSS Global would be between three entities, viz., KSS Holding, KSS Infra EALQ and Fraseli, each of whom had the right to appoint an equal number of directors on the board of directors of KSS Global. Not only this, but Fraseli was also granted affirmative voting rights as aforementioned, on certain important specified matters. There would be no doubt whatsoever that, just before presentation of the resolution plan of 12.2.2018, AMIPL would be hit by Section 29A(c), as a group company of Shri L.N. Mittal exercised positive control, by its shareholding, right to appoint directors and affirmative voting rights, over KSS Global, which in turn held 100% shareholding in KSS Petron. Again, as in the case of Uttam Galva, there can be no doubt whatsoever that the sale of Fraseli?s shareholding in KSS Global, together with the resignation of the Mittal directors from the board of directors of KSS Global, is a transaction reasonably proximate to the date of submission of the resolution plan by AMIPL, undertaken with the sole object of avoiding the consequence mentioned in the proviso to Section 29A(c). Having regard to the law laid down by us in this judgment, it is, therefore, clear that AMIPL is ineligible under Section 29A(c) of the Code, on this account as wellSince this aspect of the case has not been argued before the authorities below, though raised in an I.A. by Numetal before the Appellate Authority, we will not countenance such an argument for the first time before this Court.