NCLT approves bankruptcy proceedings against Housind Development and Infrastructure

By: | Published: August 4, 2017 7:33 AM

Bankruptcy proceedings have been approved against a wholly owned subsidiary of Mumbai-based real estate developer Housing Development and Infrastructure (HDIL).

The Mumbai bench of the National Company Law Tribunal (NCLT) has admitted an application for insolvency proceedings under the Insolvency and Bankruptcy Code, 2016, filed by the state-run Union Bank of India. (Image: Reuters)

Bankruptcy proceedings have been approved against a wholly owned subsidiary of Mumbai-based real estate developer Housing Development and Infrastructure (HDIL). The Mumbai bench of the National Company Law Tribunal (NCLT) has admitted an application for insolvency proceedings under the Insolvency and Bankruptcy Code, 2016, filed by the state-run Union Bank of India. In a stock exchange filing on Thursday, HDIL said the application had been filed against Guruashish Constructions, which houses a residential project in the western suburb of Goregaon in Mumbai. Sources told FE that the company had defaulted on repayment of Rs 250 crore to Union Bank of India earlier this year, which led the bank to file a bankruptcy plea against the developer’s subsidiary.

The notice said NCLT “has appointed insolvency resolution professional to carry out the functions as mentioned under the said section of the Code vide order dated July 24, 2017”. “The company will file an apt reply and will take an appropriate measure, as and where required in the proceedings with the Tribunal and the Appellate Authorities,” it said. HDIL reported a profit of Rs 155 crore for FY17, a drop of 38.6%. The firm posted revenues of Rs 710 crore, down 38%. In a separate instance, in June 2017, HDIL had said on the BSE that the company has received the possession notice from Central Bank of India on account of an non-performing asset due to technical reasons.

The clarification followed reports in the media that Central Bank of India had seized a 10-acre portion of all pieces and parcels of land and premises across 2.13 lakh square metres, situated at Premier Road, off LBS Marg, Kurla West, a suburb of Mumbai. The total debt of HDIL stood at nearly Rs 2,400 crore as on March 31, 2017. The HDIL share ended Thursday down 2.80% at Rs 83.45 on the BSE.

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