Lenders of debt-ridden Reliance Capital Ltd (RCAP) have alleged that Hinduja Group company IIHL is adopting delay tactics, which is also delaying the implementation of the resolution plan.
On the other hand, the Hinduja Group company denied the allegations and said it was following due process. Mauritius-based IndusInd International Holdings Limited (IIHL) emerged as the successful bidder for the acquisition of Reliance Capital.
The Mumbai bench of the NCLT on February 27, 2024, ordered the IIHL's Rs. 9,861 crore resolution plan was approved. According to the report, the borrower claims that IIHL later took the step of seeking approval from the Department of Industrial Policy and Promotion (DIPP). He said this was not even part of the conditions laid down by the NCLT while approving the resolution plan on February 27, 2024.
According to sources, 90 days have passed since IIHL submitted the application to DIPP, but approval is still pending. IIHL sources said that all the allegations are completely false, baseless and an attempt to defame and disrupt the resolution process.
There is no reason for IIHL to delay the implementation of the scheme, especially when IIHL has already deposited with the CoC Rs. 2,750 crores have been deposited.
He said that contrary to the allegations, it is in IIHL's interest to take over the company by completing a resolution plan as soon as possible, so as to prevent the erosion of value on a day-to-day basis.
DIPP's approval is required as some of IIHL's shareholders are Hong Kong residents. which is a special administrative region controlled by China. According to Press Note 3, if any entity, citizen or permanent resident of any country sharing a land border with India (China, Bangladesh, Pakistan, Bhutan, Nepal, Myanmar and Afghanistan) invests in India, it must obtain its permission. Government's approval has to be taken for its approval.
. Source
