The National Company Law Appellate Tribunal (NCLAT) has set aside a March 16, 2020, order passed by the competition watchdog concerning Grasim Industries’ Viscose Staple Fibre (VSF) business. The tribunal has remanded the matter back to the original authority for a fresh hearing. As a result of this development, the previously imposed penalty of INR 301.61 crore and associated behavioral directions have been nullified, providing immediate relief to the company.
Legal Development in VSF Business
On May 5, 2026, the NCLAT issued a significant ruling in the ongoing litigation involving Grasim Industries. The order, which pertains to a long-standing case regarding the company’s Viscose Staple Fibre (VSF) operations, has been successfully challenged. The tribunal has officially set aside the decision issued on March 16, 2020, directing the authorities to conduct a fresh hearing and consideration of the case.
Impact on Financial Provisions
The original 2020 order had imposed a financial penalty of INR 301.61 crore on the company. Following the recent NCLAT ruling, this penalty, along with various behavioral directives, has been effectively set aside. It is important to note that Grasim Industries had maintained a defensive stance throughout the proceedings and had not created any financial provision in its books of account for this specific matter. The company had previously secured a stay on the original order, preventing any immediate cash outflow.
Next Steps
With the matter now remanded, the process will return to the original competition authority for a re-evaluation. The company continues to monitor the developments and will provide further updates as the fresh hearing progresses under the legal framework.
Source: BSE
