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Hinduja offer of Rs 9,000 crore cash upfront trumps Torrent bid of just Rs 4,000 crore cash and the balance to be paid to lenders in three equal instalments in year 3/4/5 with zero interest.

The objective of the IBC Code is to maximise value for creditors. As such, the Hinduja bid is best of execution compared to Torrent as it has no requirement of sharing security as the CoC will be concerned with any dilution of current security.

In repeated Supreme Court judgements, it has been held that maximisation of value is a key factor in any plan approval by CoC.

The only resolution done for a financial services company under special powers of RBI Section 227 was DHFL which was won by Piramal Group.

In that case Adani Group, which was not even a resolution applicant, was admitted by CoC as it offered highest value to the Piramal bid.

Legal observers see Torrent's move to stall the RCap resolution and buy the company to the detriment of creditors who will be denied Rs 9,000 crore cash upfront. As such, Torrent's move, legal references claim could be a poison pill for the creditors undermining the IBC process.