STOCK MARKET BSE NSE

NCLT directs DHFL lenders to consider ex-promoter’s offer

This offer is better than Piramal Group, which has emerged as the highest bidder with Rs 35,500 crore for the whole loan portfolio of DHFL.

Published: 20th May 2021 10:16 AM  |   Last Updated: 20th May 2021 10:16 AM   |  A+A-

Court Hammer, judgement, order, Gavel

Representational Image. (File Photo)

Express News Service

NEW DELHI:  In a curious turn of event, the Mumbai Bench of the National Company Law Tribunal (NCLT) has asked creditors of distressed housing finance company Dewan Housing Finance Corporation ltd (DHFL) to consider an out-of-court settlement offer of the NBFC’s former promoter. The adjudicating authority has given the lenders ten days time to consider the offer.

The matter will be heard next on May 31. Ex-promoter of the DHFL Kapil Wadhawan has apparently offered to pay Rs 91,158 crore to the lenders, which include State Bank of India, Canara Bank, NHB, Union Bank of India, etc. This offer is better than Piramal Group, which has emerged as the highest bidder with Rs 35,500 crore for the whole loan portfolio of DHFL.

The NBFC is the first financial institution to be put under the corporate insolvency resolution process (CIRP) under the Insolvency and Bankruptcy Code (IBC). The NCLT’s order asking the committee of creditors (CoC) to consider Kapil Wadhawan’s offer comes as a surprise as the CoC has approved Piramal’s resolution application by 90 per cent vote share.

According to sources close to the development, the CoC has already submitted a certification that Piramal’s bid has been approved. The order also came as a surprise as Kapil Wadhawan and his brother Dheeraj Wadhawan are already being investigated in a number of cases including the Yes Bank fraudulent case. A senior lawyer, on the condition of anonymity, even questioned the ability of Wadhawan to pay Rs 91,000 crore.

Besides, there are many legal points on which experts find the NCLT order untenable. Under the IBC, only an applicant which has moved the insolvency petition against a corporate debtor is allowed to file an application of withdrawal under Section 12A of the IBC. However, in this particular case, it is the RBI which has moved the insolvency application against DHFL.  The insolvency application against DHFL was moved by RBI in November 2019. The home loan firm owes Rs 87,000 crore to creditors.

Offer nitty-gritty 
Wadhawan had offered a settlement proposal of Rs 91,158 crore in December last year ahead of the final round of bid submission. While the CoC did not consider this offer, Piramal Group emerged as the highest bidder with Rs 35,500 crore for the whole loan portfolio of DHFL.



Comments(1)

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

  • Hudaf

    The NCLT order has now exposed the huge fraud being executed by the unscrupulous Administrator at DHFL in selling off assets at a huge discount to their value thus causing a loss of tens of thousands of crores to banks and the public investors. RBI should hence immediately replace the Administrator and his unscrupulous legal advisors and execute the path identified by NCLT as it is the best interest of everyone to end this fraud.
    5 months ago reply
flipboard facebook twitter whatsapp