DHFL depositors left high and dry after NCLT approves Piramal’s bid

As per the resolution plan approved by the NCLT, 74,500 fixed depositors are likely to get only 20-25% of their total claims of Rs 5,360 crore. 

Published: 07th June 2021 03:25 PM  |   Last Updated: 07th June 2021 03:25 PM   |  A+A-

Ex-promoter of DHFL Kapil Wadhawan would challenge NCLT’s order in appellate tribunals, said a lawyer representing the CoC.

Express News Service

NEW DELHI: Is it the end of the road for the fixed depositors of DHFL after the National company Law Tribunal (NCLT) approved the Piramal Group’s bid for the housing finance company?

As per the resolution plan approved by the NCLT, 74,500 fixed depositors are likely to get only 20-25% of their total claims of Rs 5,360 crore. The depositors had filed a total claim of Rs 5,418 crore of which 58 crore was rejected by the administrator in the DHFL corporate insolvency resolution process.

A writ petition filed in the Delhi High Court is now the only hope for depositors, it seems. However, the High Court has been deferring hearings in the case since March. The Delhi High court had last heard the matter in February 2021.

According to people who are associated with the case, the bench adjourned the case without hearing a word on 5 March, 9 March, 15 April, 13 May and 2 June.  “Next hearing is 29 July despite us pointing out that NCLT is about to pass its approval order,” said a person close to the developments.

The writ petition filed by Sasakawa-India Leprosy Foundation (SILF), which is one of the depositors, has challenged the constitutional validity of Financial Service Providers (FSP) rule under the Insolvency and Bankruptcy Code.

The FSP rule has been challenged on the ground that it forbids the exercise of the RBI’s powers under Chapter III-B of RBI Act to actively protect the interests of the depositors of an NBFC.

The petition further argues that the new rule nullifies the rights of public depositors of a housing finance company to claim repayment of their deposits under the RBI Act and NHB Act, and that it does not provide for any regulatory oversight by the RBI in respect of the distribution mechanism for creditors of a housing finance institution.

The petition also accuses the FSP rule of discriminating between depositors of NBFCs and those of banks which are also regulated by the RBI.

Above all, the petition also questions RBI’s dual role as the regulator of financial institutions and the initiator of CIRP under the IBC.  “This presents a unique situation as the RBI is statutorily bound to act in public interest and in the interest of depositors,” argues the petition.

The Mumbai bench of the NCLT on Monday approved Piramal Capital’s bid for DHFL. Piramal Capital is offering Rs 37,500 crore against the total claims of Rs 90,000 crore.

Ex-promoter of DHFL Kapil Wadhawan had offered for settlement and was ready to pay back Rs 91,000 crore to creditors. Though NCLT had asked the Committee of Creditors to consider Wadhawan’s offer, NCLAT stayed the order and asked NCLT to hear the petition for approval of Piramal’s bid.

A lawyer representing the CoC told The New Indian Express that Kapil Wadhawan would challenge NCLT’s order in appellate tribunals.


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