HomeBusinessEPFO Has Sought Insolvency Proceedings Against Reliance Capital: Government

EPFO Has Sought Insolvency Proceedings Against Reliance Capital: Government

EPFO Has Sought Insolvency Proceedings Against Reliance Capital: Government

EPFO has requested authorities to provoke insolvency proceedings towards Reliance Capital

New Delhi:

Government knowledgeable Parliament on Tuesday that the Employees Provident Fund Organisation (EPFO) has requested it to start insolvency proceedings towards Reliance Capital because it has invested Rs 2,500 crore within the firm’s bond programmes.

In a written response to a query in Rajya Sabha, minister of state for finance Bhagwat Karad mentioned that the labour ministry has knowledgeable about EPFO having invested Rs 2,500 crore in Reliance Capital Limited (RCL), for which RCL has defaulted in cost of curiosity from October 2019 onwards.

He was replying to a question by Member of Parliament from RJD, Manoj Kumar Jha, who sought to know whether or not it was a indisputable fact that Reliance Capital had defaulted on cost of principal and curiosity obligations on bonds held by EPFO.

The whole curiosity default on the non-convertible debentures (NCDs) (secured) is Rs 534.64 crore as of November 30, 2021, Mr Karad mentioned.

Ministry of Labour and Employment has knowledgeable that because the maturity date of those funding has not turn into due until date, there isn’t any default on principal as on date, he mentioned.

“The matter for initiation of action under the provisions of the Insolvency and Bankruptcy Code, 2016 (IBC), against Reliance Capital Ltd was taken up by EPFO,” Mr Karad added.

Citing motion taken by the RBI, the minister knowledgeable the higher home that the apex financial institution outmoded the board of administrators of the corporate on November 29, 2021.

It (RBI) has filed an software on December 2, 2021 for initiation of company insolvency decision course of (CIRP) towards Reliance Capital on the Mumbai department of the National Company Law Tribunal (NCLT).

“As per the section 12 (3) of IBC, CIRP needs to be mandatorily completed within a period of three hundred and thirty days from the insolvency commencement date,” the minister mentioned additional.

Earlier this month, the corporate requested its collectors to submit their claims with proof by December 20 following initiation of company insolvency course of towards it.

Last month, the Reserve Bank had outmoded Reliance Capital’s board, citing defaults and governance points.

The firm’s promoters have supported the RBI software of referring it to the NCLT beneath part 227 for fast-track decision.

Reliance Capital owes its collectors over Rs 19,805 crore, majority of the quantity by way of bonds beneath the trustee Vistra ITCL India. The firm is the third NBFC to go for decision beneath the IBC after Dewan Housing Finance.

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