In a recent update it is was notified that the National Company Law Tribunal has approved the crisis-hit IL & FS to selling its stake in Gujarat International Finance Tec-City Company (GIFTCL) to the Gujarat Government. It has also been recorded that IL & FS have about 50 per cent stake in GIFTCL.
The payment of a positive equity value of 100 per cent of the IL & FS stake in GIFTCL has been agreed by the Gujarat government by which, the positive equity value of over Rs 32.70 crore will come to IL & FS according to the order issued by the NCLT.
It was further stated in the order that the IL & FS had sought for an amount of Rs 61.84 lakh is excluded as resolution process costs incurred for meeting various expenditures, other applicable taxes from the sale proceeds of the applicant’s shareholding in GIFTCL to the Gujarat government.
IL & FS have also been permitted by the NCLT to withdraw a sum of Rs 3 crore from the escrow account opened to keep sale consideration for meeting the additional process resolution costs that may therefore arise, after approval by the Board of Directors appointed by the tribunal.
A statement issued by the NCLT read as follows: “In view of the relief sought by the applicant, this bench hereby approved that sale of shares of GIFTCL held by IL & FS to Governor of State of Gujarat/ Gujarat Urban Development Company Limited shall be free and clear from all encumbrances, liens, security interest and third party claims (including any statutory or tax claims) upon the receipt of sale consideration from the GUDC.”
It was further added that the sale consideration payable to the IL & FS, excluding resolution process costs will be credited into a designated Escrow Account intimated by the applicant and such funds will be maintained as interest bearing fixed deposits.
The NCLAT also known as The National Company Law Appellate Tribunal had permitted green entities to continue in accordance with the resolution framework subject to the supervision of the Justice (Retd.) D K Jain. IL & FS have commenced the resolution process of GIFTCL since GIFTCL has been classified as a ‘Green Entity’.