NCLAT Fixes Date for Settlement for McLeod and IL & FS Infrastructure Debt Fund

NCLAT Fixes Date for Settlement for McLeod and IL & FS Infrastructure Debt Fund

In recent update, the massive tea production company McLeod Russel and an IL & FS Infrastructure Debt Fund (IL&FS) arm are currently in discussion to opt for an out-court settlement, which might lead the tea producer fall out of the Corporate Insolvency Resolution Process (CIRP).

The National Company Law Appellate Tribunal (NCLAT), has fixed the date of next hearing on 9 May by which both the parties must try for a settlement.

NCLAT in its earlier order had restrained the Interim Resolution Professional (IRP) of McLeod Russel from taking any further steps in the CIRP till the next hearing. The interim order would continue till May 9.

The case dates back to 2019, when IIDF, a financial creditor of McLeod, filed the petition under Section 7 of the Insolvency and Bankruptcy Code, 2016 (IBC) against the company for default in payment of Rs. 347.4 crore as on 12 November 2019. The date of default was stated as 9 July, 2019. Out of this, the principal amount was Rs. 252 crore and penal interest was over Rs. 94 crore.

Following which, the National Company Law Tribunal (NCLT), Kolkata bench admitted IL&FS Infrastructure Debt Fund’s insolvency petition for initiating CIRP against McLeod Russel India. IL&FS Infra Asset Management (IIAML) manages the IL&FS Infrastructure Debt Fund (IIDF).

Subsequently, the NCLT on 10 February, passed an order, appointing Ritesh Prasad Adatiya as the interim resolution professional (IRP) of the corporate debtor to carry out the functions as per the IBC. There shall be a moratorium under Section 14 of the IBC.

As per reported sources, both the parties are expected to complete its discussion before the next hearing.