 "Reliance Capital lenders move NCLAT against Hinduja Group's IIHL")
The Committee of Creditors (CoC) of Reliance Capital has filed a petition with the National Company Law Appellate Tribunal (NCLAT), seeking to forfeit funds deposited by Hinduja-owned Indusind International Holdings (IIHL) in the event of a default. The CoC is also requesting interest on the delayed payment by IIHL intended for acquiring the company.
According to the petition, the CoC is demanding that IIHL pay interest at an annual rate of 16.6 per cent on the upfront payment of Rs 9,660 crore from May 27th — the original resolution plan date — until its implementation on August 8 of this year. The CoC claims it has incurred losses of approximately Rs 400 crore up to August 8 due to IIHL’s payment delay. The petition argues that while IIHL faces no cost for the extension and delay, the CoC continues to suffer financial losses.
Initially, IIHL was required to implement the RCAP resolution plan by May 27, but this deadline was extended to August 8 by the NCLT at IIHL’s request. Now, IIHL is seeking another extension, citing the need for additional time to secure various regulatory approvals, which has prompted the petition to the NCLAT.
The petition highlights that the bankruptcy process has been ongoing for about 16 months since the extended challenge mechanism was put in place. It warns that if IIHL defaults and the process must be restarted, lenders could face significant further losses due to the time required to find a new buyer. As a result, the CoC is requesting that any equity component funds of Rs 2,750 crore be forfeited and not returned to IIHL in the event of a default.