Mail News Service
Jamshedpur: In a long-pending insolvency battle, the National Company Law Tribunal (NCLT), Kolkata Bench, has approved Vedanta Limited’s Rs 545-crore resolution plan for Incab Industries Limited — a decision that brings mixed outcomes for lenders, workers and operational creditors.
The order reveals sharp disparities in recoveries across stakeholder groups.
The biggest relief comes for workers, with Vedanta committing to pay 100 % of provident fund (PF), interest, damages and gratuity dues.
The total admitted PF liability of around Rs 26.50 crore will be paid separately and over and above the resolution amount — a move widely welcomed by labour bodies.
However, beyond PF and gratuity, the picture is far less encouraging.
Heavy Losses for Financial Creditors
Financial lenders face a drastic 83 % haircut. Against admitted claims of over Rs 2,619 crore, they will recover only around Rs 446 crore.
The approval order also raises questions: despite Incab’s fair value being pegged at Rs 511 crore and liquidation value at Rs 429 crore, lenders must settle for a sharply reduced recovery.
While Vedanta will gain future opportunities for restructuring or recoveries, banks see no clear path to recoup public funds already lost.
Workers Get PF Relief, But Only 6% Recovery on Other Dues
For workers, the outcome is a blend of relief and resentment.
While PF and gratuity are fully protected, other dues — including salary arrears, allowances and termination benefits — take a severe hit.
Against admitted claims of Rs 186.68 crore, workers will receive only Rs 16.24 crore, a meagre 6% recovery.
Labour unions argue that while the PF payout is welcome, the drastically reduced settlement for long-pending wage claims is “far from justice” after years of litigation and financial hardship.
Zero Payout for Operational Creditors
Local traders, contractors and suppliers are left completely empty-handed.
Operational creditors had admitted claims of Rs 51.62 crore, yet the plan allocates nothing for them.
MSMEs say their contribution to keeping Incab functional during difficult times has been ignored, and that the plan offers no protections or alternative relief for small businesses.
Uncertainty Over Jobs and Revival
Questions also loom large over the future of Incab’s plants and workforce.
The resolution plan does not clarify when the company’s long-idle units will restart, whether former workers will be rehired, or what continuity will be offered to existing employees.
This lack of commitment has fuelled doubts about the company’s actual operational revival, with experts noting that the plan focuses heavily on financial restructuring while offering little detail on long-term business rehabilitation.
Legal Cloud Still Hangs
The tribunal has also noted that the implementation of the plan is subject to the outcome of certain ongoing appeals before the NCLAT.
A Mixed and Contested Outcome
Incab’s resolution marks a significant step in closing a decades-old insolvency case, but the decision leaves behind a trail of unresolved concerns.
While PF and gratuity payments offer meaningful relief to workers, the deep haircuts for lenders, negligible recovery for wage claims and the complete exclusion of operational creditors have drawn criticism.
With no clear roadmap for jobs or plant revival, stakeholders believe the plan falls short of delivering a fair and holistic resolution.
For now, the settlement offers closure — but not necessarily comfort — to those who have waited years for justice.
