INSUBCONTINENT EXCLUSIVE:
The debt crisis at ILFS came to light following a series of defaults by its group companiesThe Supreme Court on Tuesday allowed reopening of
Infrastructure Leasing Financial Services (ILFS) accounts for the last five years
The move by the top court comes as a setback for Hari Sankaran, the former ILFS managing director, who had challenged an order by the
National Company Law Appellate Tribunal (NCLAT) to reopen the past books of the embattled infrastructure lending company
The matter relates to ILFS' default on its interest payments last year that highlighted a liquidity crisis in the country's non-banking
finance company (NBFC) sector.Mr Sankaran and ILFS Financial Services chief Ramesh C Bawa were arrested by the Serious Fraud Investigation
Office (SFIO) in April this year in connection with its probe into loan defaults of ILFS and its group companies.The Supreme Court had in an
interim order in May stayed the NCLAT's order to reopen the past books of ILFS and its group companies, but the new management of the
company urged it to vacate the stay.The government, which took control of ILFS' board in October last year, is working on a resolution plan
for the ailing company.ILFS has defaulted on payment of loans to Small Industries Development Bank of India (SIDBI) and along with its
subsidiaries has a combined debt of over Rs 91,000 crore.The debt crisis at the infrastructure lender came to light following a series of
defaults by its group companies beginning September 2018.Once hailed as a pioneer of public-private partnership, the crisis-ridden ILFS
group has come under the scanner of multiple regulators for alleged defaults related to financial disclosures and corporate governance.The
Enforcement Directorate last month carried out fresh searches in Mumbai in connection with its money laundering probe in the multi-crore
ILFS payment default crisis, news agency Press Trust of India quoted officials as saying.
