Chennai, May 10 : Exiting the Corporate Insolvency Resolution Process (CIRP) list, sugar manufacturer Dharani Sugars & Chemicals Limited (DSCL) hopes to restart operations at its three plants soon, said a top official of the PGP Group.

Dharani Sugars is hopeful of re-starting the operations at its three factories in Tamil Nadu and working closely with over 35,000 cane growers, Palani G. Periasamy, Chairman, said.

"Growth prospects look promising for Indian sugar sector with growing demand for sugar and the necessary policy thrusts provided by the Centre and states for producing ethanol as an alternate fuel and power from bagasse," he added.

The company will have to overhaul the equipment and the process machinery that has not been in use for the past couple of years.

With the original promoters of Dharani Sugars taking back control and management of the company, hopes for the revival of the three sugar factories located in Tamil Nadu's Vasudevanallur (Tirunelveli district), Polur (Tiruvannamalai district) and Kallakurichi (Sankarapuram district) is on the cards.

According to Periasamy, the National Company Law Tribunal (NCLT) allowing their proposal for Dharani Sugars affirms the group's commitment and consistent efforts for revival of sugar and allied businesses.

Dharani Sugars suffered losses during the period 2016-19 as a result of consecutive failure of rainfall and other reasons resulting in non-payment of loans to the lender consortium.

The company was admitted into CIRP by the NCLT, Chennai Bench during July 2021.

The promoters have been making continuous efforts to revive the company by making payment to the banks and exit this process.

They had also paid 35 per cent of the agreed amount to the consortium lenders as part payment and submitted a proposal under relevant rules to the Committee of Creditors (CoC).

Since the promoters could not arrange the balance funds on time, the NCLT Chennai Bench issued orders for liquidation of the company on March 18, 2023.

The liquidation orders were challenged in the Supreme Court who granted a stay of the above orders on August 7, 2023.

In the meantime, National Asset Reconstruction Corporation Limited had taken over the loans from the consortium lenders (10 banks) except the loans from IREDA and Sugar Development fund (SDF).

The 12A proposal was approved by the COC consisting of NARCL, IREDA & SDF with a voting of 92.6 per cent and the Lead Bank submitted the proposal to withdraw the CIRP process through the Resolution Professional.

As per Section 12A of the Insolvency and Bankruptcy Code (IBC), application for withdrawal from the insolvency process can be allowed if 90 per cent of voting share of CoC agrees for the same.

/IANS