DRT puts restraint on DHFL from making payments to unsecured creditors
[ by Kavita Krishnan ]The Pune bench of the Debt Recovery Tribunal (DRT) has restrained Dewan Housing Finance Limited (DHFL) from making any further payments to any of its unsecured creditors, except in cases where the payments are to be made on a pro-rata basis to all secured creditorsThe order was passed on an application filed by Catalyst Trustee, the custodian of the indebted...
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The Pune bench of the Debt Recovery Tribunal (DRT) has restrained Dewan Housing Finance Limited (DHFL) from making any further payments to any of its unsecured creditors, except in cases where the payments are to be made on a pro-rata basis to all secured creditors
The order was passed on an application filed by Catalyst Trustee, the custodian of the indebted home financier’s bond holders.
A day earlier, Bombay High Court had allowed DHFL to make payments to banks and Non Banking Financial Companies (NBFCs) that have securitization arrangements with the stressed mortgage financier.
According to the lawyer involved in the case, the order passed by the DRT will not have any bearing on the order passed by the Bombay High Court since the High Court has allowed DHFL to pay money to lenders where it is acting as a recovery agent after DHFL assigned its loans to the banks.
The DRT has appointed a commissioner to monitor and supervise the affairs of DHFL.
The presiding officer of DRT, Deepak Thakkar, also directed the trustees to appoint a commissioner to monitor and supervise the transactions of DHFL. There are about 85,000 debenture holders and Catalyst Trustee moved the DRT in order to recover Rs. 26,861 crore worth of debt securities.
