In a reversal of stance, the Ministry of Corporate Affairs (MCA) and the new board at Infrastructure Leasing & Financial Services (IL&FS) has proposed that any payments, whether principal or interest, made to the creditors of IL&FS after the cut-off date of October 15, 2018, be clawed back from them.
The MCA and the new IL&FS board have suggested that October 15, 2018 be considered the cut-off as the National Company Law Appellate Tribunal (NCLAT) had on that date imposed a blanket moratorium on payments to any creditors of IL&FS.
“Each such payment shall be made to a creditor in respect of the admitted claim of the relevant creditor as of the cut-off date, that is October 15, 2018, and as admitted by the claims management consultant. It shall be adjusted for any amounts which have been set off or appropriated by the relevant creditor in breach of the interim order passed by the NCLAT on October 15,” the MCA has said in its affidavit to the NCLAT.
The proposal is likely to impact nearly 155 companies, including 22 ‘green’ category companies that were, on pleas moved by MCA and new IL&FS board, allowed to service their debt obligations by the NCLAT on February 11, 2019.