The National Company Law Tribunal (NCLT) on December 3 passed an interim order to attach all movable or immovable properties of nine former directors of IL&FS. The court also directed them to disclose their securities and bank accounts within the country and overseas.
The Ministry of Corporate Affairs submitted an interim report of the Serious Fraud Investigation Office (SFIO) in NCLT Mumbai today seeking to implead six former directors of IL&FS. In a separate petition, MCA also sought the attachment of movable or immovable properties of nine former directors. The court accepted both the petitions.
IL&FS former directors' counsel argued: "The old board took business decisions that may have gone wrong. The business model was followed in a project-specific subsidiary way and all the accounts of all the years are fully audited. Shareholders of ILFS (LIC, SBI) have approved all the activities. The downfall in Infrastructure sector ILFS was no exception. We tried to take steps to solve the debt situation through an asset sale and even got into a deal with a foreign company and Piramal that did not get through.”
MCA counsel Sanjay Shourie raised concern on alleged wrongdoing in employee welfare trust (EWT) saying, "Of the Rs 440 crore of welfare trust, only 1 percent went to the employees. In 2014 as part of restructuring, IL&FS’ merger with Piramal was contemplated. Employees trust held 1.50 crores shares of IL&FS Ltd. and trustees distributed 90 percent of the EWT holding of 1.35 crores to select employees. The SFIO investigation reveals EWT took loan to purchase shares of IL&FS and group companies despite knowing of no way to repay.”
Courtesy/By: Shubham Mathur
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05 Dec 2018
