A tribunal consented with the decision of the newly constituted board of the IL&FS and observed that the initiation of bankruptcy proceedings was the best option for the two firms.
Deloitte had challenged the jurisdiction of the NCLT to ban it, saying section 140(5) of the Companies Act pertains to auditors who are still auditing the company in question while it has already resigned from the service and thus cannot be banned under the given provisions.
Joint MD of the company Arun K Saha and MD of transportation network K Ramchand were arrested late evening in Mumbai under the Prevention of Money Laundering Act.
For non-banks, the IL&FS crisis was nothing short of India's Lehman moment, which has for a foreseeable future reset the sector on multiple grounds.
Rejecting the contention of the auditors and others that they cannot be treated as part of the management, which is responsible for managing the affairs of the company and therefore should not be charged as per the said section, the NCLAT said that rules of natural justice are to be followed.
Alvarez & Marsal will develop a detailed restructuring plan for the group to demonstrate to shareholders and lenders that it was self-sufficient in repaying its liabilities. So far, the IL&FS management had been working on its revival plan.
The corporate affairs ministry proposed the names of Borkar & Mazumdar & Co and MM Chitale & Co for IL&FS and IFIN respectively; and GM Kapadia & Co and CNK & Associates for IL&FS Transportation Networks.
The auditors -- the local arms of the Big Four global firms Deloitte Haskins & Sells and KPMG which has BSR & Associates as an affiliate here-had challenged the jurisdiction of the NCLT to ban them.
The board will first need to unpack IL&FS - it has 169 group companies with 24 direct subsidiaries, 135 indirect subsidiaries, six joint ventures and four associate companies, says Amit Tondon.
They have also been accused of extending loans for criminal intent of falsification of repayment by a number of borrowers, including some entities associated with large corporate groups.
Under the plan, the government has categorised IL&FS group companies into green, amber and red based on their respective financial positions.
Foreign investors have poured Rs 57,359 crore into Indian equities in September, making it the highest inflow in nine months, mainly driven by a rate cut by the US Federal Reserve. With this infusion, foreign portfolio investors' (FPIs) investment in equities has surpassed the Rs 1 lakh crore mark in 2024, data with the depositories showed. Going ahead, FPI inflows are likely to remain robust, driven by global interest rate easing and India's strong fundamentals.
Even erstwhile independent directors were being paid substantial remuneration including commission. The median annual salary of IL&FS employees was Rs 13.1 lakh.
The ED is contemplating a special audit of the account in the backdrop of rating agencies downgrading various debt papers of IL&FS.
With real estate valuations falling and other deals coming unstuck, the current management's improved target faces significant challenges.
Foreign investors have injected close to Rs 33,700 crore in domestic equities in this month so far primarily due to interest rate cut in the US and resilience of the Indian market. This also marks the second highest inflow in a month in this year so far, the last one being in March, when Foreign Portfolio Investors (FPIs) infused Rs 35,100 crore, data with the depositories showed. Going ahead, the trend of FPIs buying is likely to continue in the coming days, V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said.
Besides 15 loan transactions to the Siva group of companies, the former directors also used unique methods to ensure the group did not get into the default list.
PSB executives said loans to group holding company IL&FS and entities might still be treated as "standard".
While the minimum holding period for LTCG taxation has now been lowered, the tax outgo could be a bit higher under the new structure.
The first tranche was raised a few weeks ago and the company was looking to raise more if needed.
The IL&FS group has a complicated structure, with the holding company owning stakes in its financial services arm as well as the subsidiaries that operate its infrastructure assets.
'A 10 to 15 per cent allocation to gold in portfolios reduces risk without compromising on potential returns.'
Will have to take impairment of Rs 15,000 crore before recovering a single rupee from its arms
The report has identified 29 instances where it appears that the loans disbursed to borrowers were in turn utilised by their group companies to repay the existing debt obligations with IL&FS Financial Services Limited.
But it does not mention its views on the government demand to ban these two auditors for five years from business.
About 24 fund houses saw a decline in their debt AUMs in the past one year.
The NCLAT said the RBI cannot restrict it from prohibiting banks from 'asset classfication' and observed that any change in this order would upset the entire resolution process of the IL&FS
The ministry has also made Udayen Sen of Deloitte, and Kalpesh Mehta and Sampath Ganesh of BSR as respondents as they were the signatories of the audit reports of the company.
Two young men jostle in a rickshaw as it clatters along a narrow, bustling lane of North Kolkata, each with a leg dangling over the side of the vehicle, a bulging sack of cosmetics nestled between them. The protagonists here are the founders of Emami - Radhe Shyam Agarwal and Radhe Shyam Goenka - childhood friends who gave up cushy corporate jobs to build a fast-moving consumer goods (FMCG) company. From a 200-square-foot rented space on Muktaram Babu Street in North Kolkata, brand Emami stepped into the competitive world of FMCG 50 years back, armed with just three products: Vanishing cream, talcum powder, and cold cream.
Based on internal evaluation and legal opinion, the management was of the opinion that the company has the ability to ultimately recover the aforesaid ICDs
Did men and women of redoubtable experience and public service, upholders of the country's steel frame and paragons of corporate governance, never smell a rat?
Given that there are hundreds of players in the shadow banking space, it's hard to make a credible estimate of potential NPAs. That creates more scope for panic, says Devangshu Datta.
The general nervousness because of the IL&FS default will prevail in the system for now.
The IL&FS management is also talking to its second-largest shareholder, Orix Corporation of Japan, to infuse more funds into the company - in case any shareholder backs out during the rights issue.
Almost 2,000 companies whose private provident and pension funds have invested in non-convertible debentures of IL&FS group firms are staring at the prospect of booking losses to the tune of Rs 9,000 crore or more if the interest income is added.
HSBC has acquired the stake from E*Trade Mauritius ( 43.85 per cent) and an additional 29.36 per cent stake from IL&FS. In addition, HSBC has paid a non- compete fee of Rs 82.45 crore ($19.4 million) for a three-year period to IL&FS.
The Company Law Board (CLB) on Thursday allowed infrastructure finance company IL&FS to take over Maytas Properties, a company promoted by the family members of disgraced Satyam founder Ramalinga Raju.
In a soon to be published book, 'Of Counsel: The Challenges of the Modi-Jaitley Economy,' former chief economic advisor Arvind Subramanian says though RBI has a good reputation, it does not mean it's always right, as for years, the RBI was unable to grasp the seriousness of the loan repayment problems or identify the prolonged frauds of Nirav Modi and the likes.
The 61-year-old MLA from Islampur seat of Maharashtra was issued the first summons for appearance on May 12 but he had sought deferment for about 10 days citing some personal and official engagements.
Lakme ambassador Ananya Panday closed the Lakme Fashion Week 2024 walking for Rahul Mishra at the Jio World Convention Centre in Mumbai.
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