The National Company Law Appellate Tribunal (NCLAT) has rejected Punjab National Bank's UK-based subsidiary's plea against the NCLT's approval of the sale of Sterling Biotech to US-based Perfect Day.

The sale, amounting to Rs 638 crore in an auction orchestrated by Sterling Biotech's liquidator under the Insolvency & Bankruptcy Code, gained NCLT's nod on November 11, 2022.

PNB (International) Ltd, a stakeholder in Sterling Biotech, contested the NCLT's decision at NCLAT, citing discrepancies in the e-auction notice, claiming that the Corporate Debtor's value far exceeded the auction amount.

The bank argued that the value stated in the e-Auction notice, Rs 548.46 crore, significantly undervalued Sterling Biotech.

A valuation report from Gajjar Techno-Economic Consultant, obtained by Andhra Bank, indicated a value more than three times higher, PTI reported.

However, NCLAT dismissed PNB's plea, noting its minimal stake of 0.734% in the Corporate Debtor's total value and its participation in the liquidation process without prior objections.

The appellate tribunal highlighted PNB's delayed objection, raised only after the auction conclusion, and emphasized the adherence to liquidation regulations in the sale process.

With Perfect Day's complete deposit and issuance of the Sale Certificate aligning with regulations, NCLAT affirmed the legitimacy of the auction's conclusion and the entitlement of the successful bidder in Sterling Biotech's ongoing operations.

The dismissal follows the initiation of a corporate insolvency resolution process against Sterling Biotech in 2018 upon a petition filed by Andhra Bank, now Union Bank of India. The NCLAT's decision stands as a conclusive ruling on the contentious sale matter.