NEW DELHI: The National Company Law Appellate Tribunal (NCLAT) on Thursday approved resolution framework for troubled IL&FS Group and sought the conclusion of resolution of all the entities, preferably within 90 days, while also clearing the formula for distribution of the sale proceeds to clear liabilities that add up to Rs 91,000 crore.
In a 101-page order, NCLAT chairman Justice S J Mukhopadhaya set aside the question of jurisdiction and asserted that the cases will be decided by appellate tribunal.
The crucial ruling sets the stage for what could be a move towards resolution of a large number of cases involving over 300 companies that were part of the IL&FS Group. The government had opted to supersede the management and take charge through a handpicked board of directors led by banker Uday Kotak, citing mismanagement at the group.
While some companies have been resolved through a variety of methods including sale, the fate of a large number of companies is unclear, prompting some of the investors and lenders to seek priority in getting a share of the pie.
NCLAT sided with the government’s formula of pro-rata distribution of the proceeds among stakeholders. “The maximisation of the asset and distribution of it to all the stakeholders are the object to be kept in mind, while following any resolution framework for the IL&FS Group companies,” the order said.
It rejected demand from financial and operational creditors for distribution of the proceeds in line with section 53 of the IBC as “public interest” was involved.
In a 101-page order, NCLAT chairman Justice S J Mukhopadhaya set aside the question of jurisdiction and asserted that the cases will be decided by appellate tribunal.
The crucial ruling sets the stage for what could be a move towards resolution of a large number of cases involving over 300 companies that were part of the IL&FS Group. The government had opted to supersede the management and take charge through a handpicked board of directors led by banker Uday Kotak, citing mismanagement at the group.
While some companies have been resolved through a variety of methods including sale, the fate of a large number of companies is unclear, prompting some of the investors and lenders to seek priority in getting a share of the pie.
NCLAT sided with the government’s formula of pro-rata distribution of the proceeds among stakeholders. “The maximisation of the asset and distribution of it to all the stakeholders are the object to be kept in mind, while following any resolution framework for the IL&FS Group companies,” the order said.
It rejected demand from financial and operational creditors for distribution of the proceeds in line with section 53 of the IBC as “public interest” was involved.
Download The Times of India News App for Latest Business News.
more from times of india business
Coronavirus outbreak
Business News
LATEST VIDEOS
More from TOI
Navbharat Times
Featured Today in Travel
Quick Links
ELSS Mutual Funds BenefitsIncome Tax Refund statusWhat is AssochamITR Filing Last DateHome Loan EMI TipsHome Loan Repayment TipsPradhan Mantri Awas YojanaTop UP Loan FeaturesIncrease Home Loan EligibilityHome Loan on PFTax Saving Fixed DepositLink Aadhaar with ITRAtal Pension YojanaNita AmbaniIndian EconomyRBIAadhaar CardSBIReliance CommunicationsMukesh AmbaniIndian Bank Ifsc codeIDBI Ifsc codeIndusind ifsc codeYes Bank Ifsc CodeVijay Bank Ifsc codeSyndicate bank Ifsc CodePNB Ifsc codeOBC Ifsc codeKarur vysya bank ifscIOB Ifsc codeICICI Ifsc codeHDFC Bank ifsc codeCanara Bank Ifsc codeBank of baroda ifscBank of America IFSC CodeBOM IFSC CodeAndhra Bank IFSC CodeAxis Bank Ifsc CodeSBI IFSC CodeGST
Get the app