IL&FS Scam: Asset Sale Should be Under Supervision of Retired SC Judge, says NCLAT
The National Company Law Appellate Tribunal (NCLAT) on Friday suggested that asset sale of Infrastructure Leasing and Financial Services (IL&FS) should be under supervision or oversight of a retired judge from the Supreme Court.
While staying arbitration proceedings against the cash-strapped group, the Tribunal asked IL&FS to submit details of all the arbitral proceedings going on against it and its 348 subsidiaries. However, arbitration proceedings where IL&FS is getting money will continue, the two-member bench headed by NCLAT Chairperson Justice SJ Mukhopadhaya said.
IL&FS group, which had a debt of more than Rs91,000 crore at the end of March 2018, is trying to sell its companies and their assets as part of its asset monetisation efforts to pay off the dues. Next hearing on the matter will be held on 28th January.
Last year in October, the Central government superseded the management of IL&FS by appointing a six-member board led by banker Uday Kotak to restore its financial solvency after it defaulted on payment dues triggering liquidity concerns in the NBFC sector.
By November, the firm initiated the asset monetisation process and received over a dozen Expressions of Interest (EoIs) towards acquiring its stake in IL&FS Securities Services Ltd (ISSL) and ISSL Settlement and Transaction Services Ltd (ISTSL).
Later, it initiated the process to sell its renewable energy business, the group's interests in education (IL&FS Education & Technology Services Ltd) and the 'Alternative Investment Management' businesses, along with other subsidiary businesses.
On Wednesday, IL&FS said it received more than 30 EoIs for domestic roads vertical IL&FS Transportation Networks Ltd. It includes its domestic EPC (Engineering, Procurement and Construction) and O&M (operations and maintenance) businesses.
IL&FS Ltd is a core investment company and serves as the holding company of the IL&FS Group, with most business operations domiciled in separate companies, which form an ecosystem of expertise across infrastructure, finance and social and environmental services.
Separately, according to a report from Times of India,
the Gujarat Metro Rail Corp (GMRC) had terminated a contract awarded to IL&FS Engineering & Construction due to delays in completing the project. The Rs374.64 crore contract was to build four stations and lay a 4.6kms viaduct for the metro project in Ahmedabad. However, facing financial constrains, the IL&FS group company had stopped work on this project since September 2018. GMRC has now given the contract to J Kumar Infrastructure.
Meanwhile the debt-ridden group has urged Export-Import Bank of India (Exim Bank) to release funds to secure the release of four employees still held hostage in Ethiopia by local staff, says a report from the Hindu Business Line
In a letter to the Exim Bank, Dilip Bhatia, chief executive of IL&FS Transportation Networks Ltd (ITNL), said the company has sought 4.89 million Ethiopian birr (ETB) from the bank. The local employees of IL&FS’ joint venture in Ethiopia, ITNL-Elsamex JV Bure, have demanded an additional four months’ net salary for the release of the four Indian employees who have been held hostage since 24 November 2018.
“This is a crisis our employees are facing in Ethiopia and it’s our humble request to kindly let these funds be unblocked to help our employees,” the ITNL letter dated 8 January 2019, seen by BusinessLine, states, adding that the bank should take a view on “humanitarian grounds”.