Seeks forfeiture of ₹2,750 crore equity component of IIH Ltd

Business: The committee of creditors (CoC) of Reliance Capital (RCap) on Thursday filed a fresh application before the Delhi bench of the National Company Law Appellate Tribunal (NCLAT), seeking forfeiture of the ₹2,750 crore equity component of IIH Ltd in case the Hinduja Group-owned company defaults.

A copy of the petition has been seen by Mint.

In brief, the lenders are seeking modification of the July 23 NCLT order that allowed IIHL to take over the insolvent Reliance Capital for ₹9,861 crore. Since then, the lenders have been at odds with the Hinduja Group over the implementation of the resolution plan. According to the petition filed before the appellate forum, the lenders have sought IIHL to pay interest on the debt component of ₹7,300 crore from August 2023 till the actual date of payment. Under the approved plan, IIHL was to deposit an initial equity amount of ₹250 crore in a domestic escrow account and ₹2,500 crore in the CoC’s offshore escrow account by July 31. Subsequently, as the deadline was approaching, IIHL filed an interim application before the NCLT seeking modification of the tribunal’s order. In this regard, the administrator has opposed granting any relief to IIHL. However, the NCLT had partially granted IIHL an extension till August 10 for implementation of the resolution plan. Experts said the appeal for seizure of funds was made to secure the interests of lenders and protect them from further losses that would be caused due to IIHL’s delay in implementing the resolution plan approved by the NCLT.