First time ever! IL&FS crisis gets murkier; govt wants to re-open company’s books

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Updated: December 21, 2018 6:25:48 PM

The corporate affairs ministry on Thursday moved the National Company Law Tribunal (NCLT) seeking to reopen the books of IL&FS Group and its subsidiaries.

The corporate affairs ministry Thursday moved the National Company Law Tribunal (NCLT) seeking to reopen the books of IL&FS Group and its subsidiariesThe corporate affairs ministry on Thursday moved the NCLT seeking to reopen the books of IL&FS Group and its subsidiaries

The crisis at IL&FS just got murkier with the government wanting to re-open its books to ascertain financial mismanagement. IL&FS crisis came to light in early September when it defaulted on servicing of several loans, following which the government replaced its board with a new one under top banker Uday Kotak.

Now the government wants to examine its balance-sheets. The corporate affairs ministry on Thursday moved the National Company Law Tribunal (NCLT) seeking to reopen the books of IL&FS Group and its subsidiaries for the past five years under Section 130 of the Companies Act, news agency PTI reported.

This will be the first time when such a move is being taken by the government Section 130 0f the new Companies Act of 2013. The government has requested to check balance sheets of IL&FS and its two subsidiaries –ITNL and IL&FS Financial Services.

Government’s decision to examine ILFS books has come after the Serious Fraud Investigation Office (SFIO) found shocking details of corruption, personal enrichment and other
non-transparent deals.

The court has said that it will seek views of regulatory authorities such as the Reserve Bank, SEBI and the Income Tax Department before taking a decision on the petition.

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