TheNational Company Law Appellate Tribunal (NCLAT) has rejected a petition by the HDFC Ltd seeking to stop the sale of IL&FS headquarters in Mumbai’s Bandra Kurla Complex (BKC) to Brookfield Asset Management. 

HDFC had made an offer to sanction a loan of ₹400 crore to IL&FS as a lease rental discounting transaction. The repayment of the said facility was to be from the cash flows generated from the use of the TIFC property being let out by ILFS. However, soon after IL&FS was put under a new management after fraudulent transactions came to light. 

The property was put up for sale as part of the new management’s efforts to recover money to pay off dues. Brookfield Asset Management offered to pay more than ₹1,080 crore for IL&FS headquarters in Mumbai’s Bandra Kurla Complex (BKC). The Commitee of Creditors voted in favour of the sale with 73.57 per cent of the members accepting the bid proposal of ₹1,080 crore. HDFC opposed the transaction and filed a plea in court for restraining the IL&FS from effecting the sale rights and titles and interest of the HDFC Ltd. in the property in question remained pending.

However, IL&FS argued that HDFC is a member of the Creditors Committee with 1.89 per cent voting share and despite objection and dissent by HDFC, the Creditors Committee by majority vote share of 73.57 per cent has approved the sale of TIFC, as per the Revised Resolution Framework. Hence, it cannot be said to be any case of violation of principles of natural justice.

Upholding IL&FS case, the NCLAT said “Present is not a case where it can be said that any principles of natural justice have been violated since the Appellant (HDFC) has raised its objection in the meeting of the Creditors Committee and also voted against the resolution.”

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