DHFL: Union Bank issues demand notice to Wadhawans

September 19, 2020 1:00 AM

Bank plans to move NCLT to file personal insolvency petition against promoters

The bank plans to move the National Company Law Tribunal (NCLT) for filing personal insolvency petition against promoters, if the payment is not received by end of this month.The bank plans to move the National Company Law Tribunal (NCLT) for filing personal insolvency petition against promoters, if the payment is not received by end of this month.

By Ankur Mishra

Public sector lender Union Bank of India has sent a demand notice to promoters of Dewan Housing Finance Corporation (DHFL) Kapil and Dheeraj Wadhawan for recovering Rs 3,000 crore for which personal guarantees were given, sources familiar with the matter told FE. The bank plans to move the National Company Law Tribunal (NCLT) for filing personal insolvency petition against promoters, if the payment is not received by end of this month.

“We have formally sent a demand notice to Kapil and Dheeraj Wadhawan. We will wait till the end of this month for payment, before filing a petition at NCLT,” a senior bank official told FE. According to an amendment to the Insolvency and Bankruptcy Code (IBC) in December 2019, creditors can file insolvency application against personal guarantors before the NCLT.

FE had reported earlier that the Department of Financial Services (DFS) had written to banks on personal insolvency petitions. DFS had asked banks to put in place a mechanism to monitor cases, which could require initiation of individual insolvency proceedings at NCLT against personal guarantors in corporate loans.

DHFL’s administrator R Subramaniakumar had earlier moved NCLT against 87 respondents, including Kapil and Dheeraj Wadhawan, on the alleged fraud detected in giving loans. The application was moved after fraudulent transactions worth Rs 14,046 crore were found in the initial report of Grant Thornton.

In a committee of creditors’ (CoC’s) meeting held last week, DHFL administrator R Subramaniakumar said five serious bidders were conducting due diligence for the company. DHFL had earlier shortlisted 22 applicants for the company. The mortgage lender had given applicants the option to bid for the whole company or in parts. Of the total applicants, 14 had submitted expressions of interest (EoIs) for the entire business of DHFL. KKR India Financial Services, Welspun Group, Adani Group, Oaktree Capital and Bain Capital were among those who placed EoIs to take over the entire business.

DHFL has been undergoing insolvency proceedings at the NCLT in Mumbai since December 3, 2019. The admitted claims of financial creditors from DHFL stood at Rs 87,120 crore as on September 10. The lead creditors include State Bank of India (SBI), Union Bank of India, Bank of India, Canara Bank.

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