DSP Asset Managers (P) Ltd. v. Grant Thornton India (Bharat) LLP

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The Tax Publishers 2025 TaxPub(CL) 1010 (NCLAT- New Del) IN THE NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI [JUSTICE ASHOK BHUSHAN ] CHAIRPERSON & [BARUN MITRA] MEMBER (TECHNICAL) DSP Asset Managers (P) Ltd. v. Grant Thornton India (Bharat) LLP Company Appeal (AT) No. 263 of 2024 1 May, 2025 Appellant by: Krishnendu Dutta, Sr. Advocate with Subhabrata Chakraborti, Madhurima Sarangi and Alina Merin Mathew, Advocates Respondent by: Animesh Bisht, Vihit Shah and Udisha Mishra, Advocates for R-2/ILFS. Mohit Kumar Bafna, Advocates for R-3. JUDGMENT *Barun Mitra, Member (Technical)* The present appeal initially filed under section 61 of Insolvency and Bankruptcy Code 2016 (IBC in short) by the Appellant which was subsequently amended by I.A. No. 6887 of 2024 and filed under section 421(1) of the Companies Act, 2013 arises out of the Order dated 13-5-2024 (hereinafter referred to as Impugned Order) passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench-I) in C.A No. 19/2024 in C.P. No. 3638/MB/2018. By the impugned order, the Adjudicating Authority has dismissed CA No. 19 of 2024 seeking admission of the claim filed by the Appellant in the insolvency process of IL&FS-Respondent No.2. Aggrieved by the impugned order, the present appeal has been preferred by the Appellant. 2. Coming to the factual matrix of the present case at hand, the salient events are as outlined below: On 22-3-2016, IL&FS Transportation Networks Ltd. (ITNL in short), a group subsidiary of Infrastructure Leasing and Financial Services Ltd.(ILFS in short) had issued and allotted 7800 Non-Convertible Debenture (NCD) pursuant to a Debenture Trustee Deed (DTD). The NCDs were issued and allotted to the Appellant-Asset Manager of DSP Mutual Fund which had been subscribed to by retail investors and salaried persons. Basis the DTD, IDBI Trusteeship Ltd.-Respondent No.3 was appointed as the Debenture Trustee (DT) on 22-3-2016. A Parent Agreement was signed between the Respondent No.2-ILFS and Respondent No.3-DT by which Respondent No.2 had undertaken to fulfil the payment obligations in the event of ITNLs failure and default in complying with its payments obligations towards Debenture Holders in relation to NCDs. On 14-9-2018, ITNL had made a default in payment obligations and Respondent No.3 had reported the same to ITNL vide default notice on 21-9-2018. On 15-9-2018, an event of default under the DTD occurred in terms of Clause 8.4(b) of the DTD as the indebtedness of Respondent No.2 had triggered an event of default under the DTD. On 01-10-2018, the Board of Respondent No.2 was superseded under sections 241 and 242 of the Companies Act and a new Board constituted. The insolvency process of Respondent No.2 commenced from October 2018. The new Board had conceived an Initial Resolution Framework in December 2018 for the resolution of the ILFS group which was followed by Addendums thereto. On 11-1-2019, this Tribunal had directed that a process similar to Corporate Insolvency Resolution Process shall be followed for resolution of Respondent No.2 and its group companies. On 22-5-2019, Grant Thornton India LLP-Respondent No.1 was appointed as the Claims Management Advisor (CMA in short) which issued public announcement inviting claims from creditors of Respondent No.2 and their group entities including ITNL. The deadline for filing claims was however extended six times upto 18-8-2022. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers 2025 TaxPub(CL) 1010 (NCLAT- New Del)

IN THE NATIONAL COMPANY LAW APPELLATE TRIBUNAL, PRINCIPAL BENCH, NEW DELHI

[JUSTICE ASHOK BHUSHAN ] CHAIRPERSON & [BARUN MITRA] MEMBER (TECHNICAL)

DSP Asset Managers (P) Ltd. v. Grant Thornton India (Bharat) LLP

Company Appeal (AT) No. 263 of 2024

1 May, 2025

Appellant by: Krishnendu Dutta, Sr. Advocate with Subhabrata Chakraborti, Madhurima Sarangi and Alina Merin Mathew, Advocates

Respondent by: Animesh Bisht, Vihit Shah and Udisha Mishra, Advocates for R-2/ILFS.

Mohit Kumar Bafna, Advocates for R-3.

JUDGMENT

Barun Mitra, Member (Technical)

The present appeal initially filed under section 61 of Insolvency and Bankruptcy Code 2016 (IBC in short) by the Appellant which was subsequently amended by I.A. No. 6887 of 2024 and filed under section 421(1) of the Companies Act, 2013 arises out of the Order dated 13-5-2024 (hereinafter referred to as Impugned Order) passed by the Adjudicating Authority (National Company Law Tribunal, Mumbai Bench-I) in C.A No. 19/2024 in C.P. No. 3638/MB/2018. By the impugned order, the Adjudicating Authority has dismissed CA No. 19 of 2024 seeking admission of the claim filed by the Appellant in the insolvency process of IL&FS-Respondent No.2. Aggrieved by the impugned order, the present appeal has been preferred by the Appellant.

2. Coming to the factual matrix of the present case at hand, the salient events are as outlined below:

On 22-3-2016, IL&FS Transportation Networks Ltd. (ITNL in short), a group subsidiary of Infrastructure Leasing and Financial Services Ltd.(ILFS in short) had issued and allotted 7800 Non-Convertible Debenture (NCD) pursuant to a Debenture Trustee Deed (DTD).

The NCDs were issued and allotted to the Appellant-Asset Manager of DSP Mutual Fund which had been subscribed to by retail investors and salaried persons.

Basis the DTD, IDBI Trusteeship Ltd.-Respondent No.3 was appointed as the Debenture Trustee (DT) on 22-3-2016.

A Parent Agreement was signed between the Respondent No.2-ILFS and Respondent No.3-DT by which Respondent No.2 had undertaken to fulfil the payment obligations in the event of ITNLs failure and default in complying with its payments obligations towards Debenture Holders in relation to NCDs.

On 14-9-2018, ITNL had made a default in payment obligations and Respondent No.3 had reported the same to ITNL vide default notice on 21-9-2018.

On 15-9-2018, an event of default under the DTD occurred in terms of Clause 8.4(b) of the DTD as the indebtedness of Respondent No.2 had triggered an event of default under the DTD.

On 01-10-2018, the Board of Respondent No.2 was superseded under sections 241 and 242 of the Companies Act and a new Board constituted. The insolvency process of Respondent No.2 commenced from October 2018.

The new Board had conceived an Initial Resolution Framework in December 2018 for the resolution of the ILFS group which was followed by Addendums thereto.

On 11-1-2019, this Tribunal had directed that a process similar to Corporate Insolvency Resolution Process shall be followed for resolution of Respondent No.2 and its group companies.

On 22-5-2019, Grant Thornton India LLP-Respondent No.1 was appointed as the Claims Management Advisor (CMA in short) which issued public announcement inviting claims from creditors of Respondent No.2 and their group entities including ITNL. The deadline for filing claims was however extended six times upto 18-8-2022.