IL&FS gets NCLAT approval for making over Rs 16,000 cr interim payout to creditors
NCLAT has directed the new board of IL&FS to make interim payout to creditors after prior approval of the new board, the tribunal said in an order
The National Company Law Appellate Tribunal (NCLAT) has directed the new board of Infrastructure Leasing & Financial Services (IL&FS) to make interim payout to creditors after prior approval of the new board, the tribunal said in an order.
The interim distribution shall be confined only to the entities as reflected in "Annexure-6" except those excluded and for the amount of Rs 16,361 crores -- Rs 11,296 crore of cash and Rs 5,065 crore of InvIT units, the order said.
"With regard to interim distribution, we further direct the new board in addition to compliance of the interim resolution process...only after approval by the new board," the NCLAT order read.
"While granting approval by the new board, the approval shall contain all details of interim distribution, including the name of the creditors and the amounts which shall be provided to the creditors under the interim distribution and only after comprehensive approval by the new board, interim distribution shall be implemented."
If it is found that creditors have by way of interim distribution received an amount more than what such creditor ought to have received, the excess amount shall be liable to be returned, failing which the same may be recovered from such creditor either by way of adjustment at the time of final distribution or otherwise, the order added.
With this order, major beneficiaries would be public funds such as provident funds, insurance funds, pension funds, and army welfare funds, the company said.
An application had been filed with the NCLAT for undertaking interim distribution of Rs 16,000 crore of cash and InvIT units available across the group.
"Over 75 per cent of this would be distributed to creditors of three large holding companies -- IL&FS, IFIN and ITNL -- which have a large base of public fund creditors. This has been made possible on account of IL&FS' resolution framework and the underlying distribution formula," the company said.