IL&FS ex-officials can withdraw Rs 2 lakh per month: NCLT

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India Ratings and Crisil have both hinted at sharp downgrades to default grade for the outstanding loans and debt at the special purpose vehicles (SPV) if repayments are stopped at those operating units.
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The Mumbai bench of the National Company Law Board (NCLT) on Friday clarified that nine former officials of IL&FS are allowed to withdraw a sum of only Rs 2 lakh per month after Roopa Kapoor, wife of Vibhav Kapoor, former director of IL&FS Investment Managers (IIML), approached the court earlier this week, claiming HSBC has frozen her bank account.

The NCLT stated that its earlier order dated December 3 had been modified by the National Company Law Appellate Tribunal (NCLAT), allowing the officials to withdraw only Rs 2 lakh per month.

On Friday, the NCLT noted: “We are of the view that order passed by us on December 3, 2018, stands modified to the extent of the order of Hon’ble NCLAT and by implication of that order a sum of Rs 2 lakh per month can be withdrawn from bank account after intimating the tribunal. Hon’ble NCLAT has further prohibited from withdrawing any further amount from the said or any other account.”

Earlier this week, a lawyer representing Ravi Parthasarathy, former chairman of IL&FS, had pointed out that his client needed to pay for his ongoing treatment. He argued, saying, “My client is suffering from cancer and the cost of the treatment is way more than the monthly limit of `2 lakh. If such order is passed then it will be very difficult for him to carry on with the treatment. In my client’s case, it is a situation of life and death”.

The lawyers representing Parthasarathy, Pradeep Puri, Arun Saha, Hari Sankaran and Roopa Kapoor, among others, had sought the tribunal’s intervention to clarify that the restraining order on the nine erstwhile top officials of IL&FS from disposing of their personal assets doesn’t include their bank accounts and credit cards.

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Meanwhile, in the last one week, India Ratings and Crisil have both hinted at sharp downgrades to default grade for the outstanding loans and debt at the special purpose vehicles (SPV) if repayments are stopped at those operating units.

India Ratings and Crisil have rated the bonds issued by five such SPVs, namely, Jharkhand Road Projects Implementation Company, Hazaribagh Ranchi Expressway, Jorbat Shillong Expressway, North Karnataka Expressway and West Gujarat Expressway. IL&FS has cited a court order by the NCLAT, claiming that its SPVs are entitled to a moratorium on repayments.

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