Supreme Court upheld Piramal’s resolution plan against DHFL, granting recovered funds

The Supreme Court ruled on Tuesday that funds recovered by Dewan Housing Finance Corporation Ltd (DHFL) from the fraudulent transaction will go to the bankrupt company’s successful settlement applicant Piramal Capital & Housing Finance Ltd.

The Supreme Court upheld Piramal’s resolution plan and overturned the National Corporate Legal Appeal Tribunal (NCLAT) January 2022 order, which directed lenders to reconsider the valuation and recycling allocation of recycling rates.

Judge Bela Trivedi and judge Satish Chandra Sharma dismissed appeals from time deposit holders and non-transferable bondholders, including 63 satellite tech companies, who challenged the solution and mechanisms for the resumption of the distribution.

The court ruled ₹DHFL’s “avoidable” and “fraudulent” transactions had a recovery rate of 45,000 million, rather than DHFL’s creditors. The decision maintains the resolution plan, which allocates nominal value ₹1 Recycle.

In addition, the court clarified that the Resolution Plan complies with the Reserve Bank of India Act 1934 and the National Housing Banking Act (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB) Regulation (NHB)

There is no evidence that any authorized official under the Reserve Bank of India Act or the Corporate Law Commission has ordered the repayment of deposits to such creditors. Therefore, the Court held that the distribution mechanism of the solution did not violate any provisions of the RBI or NHB Act.

Resolution plan presents challenges

The case stems from a default of a housing finance company, a violation of the overseas loan default of the National Bank of India and other creditors, and the case stems from the bankruptcy proceedings initiated by the Reserve Bank of India against DHFL in 2019. DHFL’s creditors alleged ₹87,9056 million membership fee.

The creditors committee approved Piramal’s resolution plan, which has a nominal value of ₹Potential recovery of fraudulent transactions under section 66 of the Bankruptcy and Bankruptcy Act. The plan allows Piramal to retain future gains from these recycling rates, and the provision has been approved by the National Corporate Law Tribunal.

In September 2021, Piramal completed the acquisition of DHFL ₹Rs 34,250 crore, including cash and non-convertible bonds, after approval from all regulators.

But there are 63 Moons Technologies Ltd that holds non-convertible bonds worth it ₹The $20 billion issued by DHFL, other creditors challenged the plan, believing that the proceeds from fraudulent transactions should be distributed to creditors.

In January 2022, NCLAT ruled that there was a ruling of 63 Moon Technology, stating that the recovery of the proceeds should benefit from creditors. NCLAT noted that NCLT failed to review correctly ₹1. Valuation of recovery rate.

Piramal appealed in the Supreme Court, which held the NCLAT order in April 2022.