M/S Il and Fs Financial Services Ltd., v. the Official Liquidator

Madras HC26 Jul 2019COMP.A/181/2019

Case brief

AI extract

What is this about?

The Court modified an order requiring the applicant to make an upfront payment to the Official Liquidator. Considering the applicant's financial constraints due to a takeover resolution plan, the Court allowed immediate monetization of secured assets, directing payment of expenses from sale proceeds within a week.

What did the court decide?

Applicant directed to pay Rs. 1,80,20,832/- to Official Liquidator immediately within one week from date of receipt of sale consideration instead of upfront payment.

M/S Il and Fs Financial Services Ltd., Vs the… — Execution and Attachment | Madras HC (2019)

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Company Application Nos.181 and 182 of 2019 in C.A.No.475 of 2017 in Company Petition No.63 of 2013

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N.SATHISH KUMAR, J.,

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These Company Applications have been filed to modify the order of

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this Court dated 19.01.2018 passed in Comp.A.No.475 of 2017.

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2. Heard the learned counsel for the applicant and the learned

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Deputy Official Liquidator for the respondent.

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3. By order dated 19.01.2018, this Court has held as follows;

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"4. In such view of the matter, the application stands ordered by directing the Official Liquidator to hand over possession, after realising the expenses incurred in maintaining the secured assets through security

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agency and expenses incurred for preparing valuation report and after retaining the possession of other assets other than the secured assets."

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4. It is the contention of the learned counsel for the applicant that pursuant to a petition filed by Ministry of Corporate Affairs, Government of India before the Ld. National Company Law Tribunal, Mumbai Bench ("NCLT"), the Board of Directors of the applicant's holding company, Infrastructure Leasing and Financial Services Limited ("IL&FS") has been reconstituted vide an order of

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http://www.judis.nic.in

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Hon'ble NCLT dated 01.10.2018. Subsequently, on 26.10.2018, the applicant's Board of Directors has also been reconstituted by the newly appointed Board of IL&FS in line with an order dated 09.10.2018 passed by the Ld. NCLT, Mumbai. The newly appointed Board of Directors of IL&FS are currently administrating the affairs of the applicant and other group companies of IL&FS ("IL&FS Group") and are in the process of working out an appropriate Resolution Plan for the IL&FS Group. In view of these circumstances, the applicant is placed under certain financial constraints and is working to ensure that its limited available financial resources are applied in a judicious manner. In these circumstances, the applicant is limited in its ability to make the upfront payment to Ld. Official Liquidator towards the expenses incurred. However, in order to facilitate the immediate monetization of the Secured Assets, the applicant undertakes that the expenses incurred by the Ld. Official Liquidator with regard to the Secured Assets will be paid by the applicant to the Ld. Official Liquidator, as per the order of this Court dated 19.01.2018, from and out of the sale proceeds realized on sale of the Secured Assets in priority over all other claims/disbursements.

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5. Considering the nature of averments and submissions, I am of the view that modifying the order of this Court dated 19.01.2018 to make the upfront payment to the learned Official Liquidator before sale, no prejudice would be caused to any of the stakeholders. Hence, the order of this Court dated

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http://www.judis.nic.in

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19.01.2018 is modified and the applicant shall pay the expenses of Rs.1,80,20,832/- immediately after sale in priority over all other claims/disbursements. Such amount shall be deposited before the learned Official Liquidator immediately within a period of one week from the date of receipt of sale consideration. In the event any deviation by the applicant, the same will amount to violation of this order and that case, the applicant will be proceeded

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for contempt of Court.

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This Company Application is ordered accordingly.
26.07.2019
sri

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http://www.judis.nic.in

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N.SATHISH KUMAR, J., sri

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Company Application Nos.181 and 182 of 2019
in C.A.No.475 of 2017
in Company Petition No.63 of 2013
26.07.2019

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http://www.judis.nic.in

M/S Il and Fs Financial Services Ltd., v. the Official Liquidator

Case brief

What is this about?

What did the court decide?

M/S Il and Fs Financial Services Ltd., v. the Official Liquidator

Case brief

What is this about?

What did the court decide?

What the court decided

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