IL&FS received 1,925 crore rupees from Haryana Shehari Vikas Pradhikaran (HSVP) as an interim termination payment in the Gurgaon metro project case.
The payment, duly received in escrow accounts, is in accordance with the order of the Supreme Court of March 26, 2021 which ruled in favor of IL & FS in the Gurgaon metro project, developed through the subsidiaries of IL & FS and Special Purpose Vehicles (SPV), Rapid Metro Rail Gurgaon Limited (RMGL) and Rapid Metro Rail Gurgaon South Limited (RMGSL).
The allocation of any amount from such escrow accounts will be the subject of subsequent orders of NCLAT or any other competent judicial authority in accordance with the order, which would be duly observed by IL&FS.
As part of the judgment, the Supreme Court ordered HSVP to deposit 80 percent of the total “debt owed” (over Rs 2,400 crore, baseline audit conducted by the CAG), amounting to 1 925 crore rupees, within three months on escrow accounts the two SPVs.
Andhra Bank is the lead bank of RMGL with PNB, Indian Overseas Bank, Indian Bank, Punjab & Sind Bank, UCO Bank, Bank of India and Dena Bank (currently Bank of Baroda).
Canara Bank is RMGSL’s lead bank along with Andhra Bank, Corporation Bank (currently Union Bank of India), Punjab & Sind Bank, Central Bank of India and IIFC (UK) Ltd.
“The Supreme Court ruling of March 26, 2021, followed by HSVP’s compliance with the order and the transfer of the amount payable to IL&FS group entities, will go a long way in protecting the interests of stakeholders and lenders in the Indian industry. infrastructure, â€said the spokesperson for the company.
The move will also set a precedent for other projects in which infrastructure companies, including IL&FS, are seeking payment of their legitimate dues and the enforceability of valid contracts and concession agreements with various state governments, a declared the spokesperson.
This resolution of Rs 1,925 crore is part of the total recovery of Rs 61,000 crore estimated by the new board of directors, which represents the resolution of over 61% of the overall debt of around Rs 99,000 crore (founded and not based on a fund) in October 2018.
The two parties – IL&FS SPV and HSVP – have the right to submit to arbitration any dispute relating to other rights under the Concession Agreement, as well as those arising from the audit report commissioned by the CAG to determine the debt owed to arbitration, in accordance with the Supreme Court ruling.
IL&FS had bagged the two-phase Gurgaon metro project developed by RMGL and RMGSL in 2009 and 2013.
Due to multiple unfulfilled obligations by the HSVP, RMGL and RMGSL had terminated the concession agreements in September 2019 and demanded termination fees in accordance with the concession contract in the event of lack of authority.
HSVP, had previously rebutted RMGL and RMGSL’s claim citing a concessionaire default and challenged the case in the High Court of Punjab and Haryana.
(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)
Dear reader,
Business Standard has always strived to provide up-to-date information and commentary on developments that matter to you and have broader political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering has only strengthened our resolve and commitment to these ideals. Even in these difficult times resulting from Covid-19, we remain committed to keeping you informed and updated with credible news, authoritative views and cutting edge commentary on relevant current issues.
However, we have a demand.
As we fight the economic impact of the pandemic, we need your support even more so that we can continue to provide you with more quality content. Our subscription model has received an encouraging response from many of you who have subscribed to our online content. More subscriptions to our online content can only help us achieve the goals of providing you with even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practice the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital editor
