NCLAT notice to Adani's Ambuja Cements over plea filed by Sanghi Industries' ex-promoter

The NCLAT has issued a notice to Adani Group entity Ambuja Cements over a plea by Alok Sanghi, former promoter of Sanghi Industries, which was acquired by Ambuja in 2023.

Passing an interim order on Tuesday, the appellate tribunal has stayed the order of the Ahmedabad-bench of NCLT which had directed initiation of insolvency proceedings against Alok Sanghi saying "in pursuance of the impugned order, no further steps shall be taken."

The National Company Law Appellate Tribunal granted two weeks’ time to Ambuja Cements and directed them to list the matter on April 14, 2025.

Alok Sanghi has moved NCLAT against an order passed by the National Company Law Tribunal (NCLT) on February 25, 2025 in an application under Section 95 of IBC filed by Ambuja Cements over the personal guarantee of ₹84 crore by him.

The NCLT has already appointed an interim resolution professional.

In his appeal, Sanghi said in the application filed by Ambuja Cements there was no mention of any personal guarantee given by him in the Share Purchase Agreement dated August 3, 2023, which only provided for warranty and indemnity.

Section 95 of the Insolvency and Bankruptcy Code (IBC), 2016, allows creditors to start insolvency proceedings against debtors, which includes personal guarantors and partnership firms.

Sanghi's counsel also submitted that NCLT at the stage of appointment of a Resolution Professional has proceeded to adjudicate the rival submissions made by the parties with regard to the nature of the Share Purchase Agreement(SPA).

However, in view of the judgment of the Supreme Court in 'Dilip B Jiwrajka Vs. Union of India & Ors', the NCLT was not required to enter into adjudicatory issues at the stage of appointment of Resolution Professional.

Ambuja Cements' counsel submitted that NCLT has not looked into various clauses of the SPA and the nomenclature of the document is not relevant and the real nature of the SPA discloses that personal guarantee was given by Alok Sanghi.

Moreover, NCLT has already directed the Resolution Professional to submit the report and make a recommendation for admission or rejection of the application to determine debt, default, indemnity, hence, no prejudice is caused to Sanghi at this stage.

However, NCLAT said the issues raised by both sides need consideration and stayed the process till the next date of hearing.

"We are of the view that the issues which have been raised by learned counsel for the parties need consideration. We issue notice to the Respondent (Ambuja Cements), who is represented by learned senior counsel," said NCLAT.

In August 2023, the Adani Group entity entered into a share purchase agreement to acquire Sanghi Industries from its promoters, followed by an open offer. As part of the deal, Sanghis were provided indemnities.

However, a dispute arose over an unpaid electricity bill, and even they failed to get any relief. As Sanghi Industries could not clear liabilities, Ambuja Cements invoked Sanghi’s personal guarantee and demanded ₹84 crore.

Ambuja Cements completed the acquisition of Sanghi Industries in December 2023. The acquisition was valued at ₹5,185 crore.