Financial Daily from THE HINDU group of publications
Friday, Jan 30, 2004
Financial Daily from THE HINDU group of publications Friday, Jan 30, 2004 |
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Money & Banking
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NBFCs MCC Finance to pay another Rs 57.57 cr to depositors — HC accepts promoters' scheme Our Bureau
Chennai , Jan. 29 MCC Finance Ltd, which is now under liquidation, has agreed to bring forward another Rs 57.57 crore to be paid back to the depositors. The company has repaid a sum of Rs 60 crore. The First Bench of the Madras High Court, consisting of Mr B. Subhashan Reddy, Chief Justice, and Mr Justice A. Kulasekaran, on Thursday accepted a scheme as proposed by the promoters of the company on the following terms and conditions: in addition to the sum of Rs 2.50 crore, which is already available with the administrator appointed by the High Court, the promoters must bring in a further amount of Rs 7.39 crore, taking the total to Rs 9.89 crore, by February 29. The balance amount of Rs 45 crore must be paid by the promoters in 18 equal monthly instalments of Rs 2.50 crore each, the first such monthly instalment to commence before April 10, 2004. Further instalments must be made on the 10th of each succeeding month. In default, the administrator will be entitled to initiate proper legal proceedings for recovery of the above amount, including that of initiation of contempt of court proceedings. After the payments are made to the depositors, there must be no further claims on the promoters by the depositors. Mr A.L. Vadivelu will be the assignee for all the present and subsequent claims. All cases, including criminal cases against the MCC Finance directors and promoters relating to the deposit holders have been withdrawn. The land belonging to the Automobile Products of India Ltd at Bhandup in Mumbai, which was proposed to be taken over and disposed of, will stand discharged towards the liability of the deposit holders. No claims or other issues must be raised against any of the group companies in the MAC (M.A. Chidambaram) group or other subsidiaries or their directors, past or present, in respect of the dispute relating to MCC Finance. The amount will be disbursed as per the following formula: deposits up to Rs 3 lakh (fixed deposits, bonds and hundis), to the extent of 65 per cent of the eligible amount; deposits exceeding Rs 3 lakh, to the extent of 50 per cent of the eligible amount; deposits exceeding Rs 3 lakh only in hundis, to the extent of 25 per cent of the eligible amount. The bench also said that from available information, MCC Finance had not indulged in any siphoning of funds. The investments made by the company had also not been defective even though some of them had turned bad.
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