DHFL depositors get no HC push in Rs 84-cr recovery, to try again on Nov 28

The Air Force Group Insurance Society and the Uttar Pradesh Power Corporation’s (UPPCL’s) provident fund did not get any relief on Wednesday from the Bombay High Court on the money they had deposited with bankrupt Dewan Housing Finance (DHFL). They will have to try again at the next hearing, on November 28.

The Air Force Society has an intervention application for recovery of Rs 84 crore. Its counsel told the court DHFL had been delaying its due payments since May. 

He argued on Wednesday that the National Housing Bank Act of 1987 gave his clients a higher priority in claims over those from banks and other creditors. The Society must, he contended, be considered an investor in the company. 

The UP Power Corporation Contributory Provident Fund Trust also has an intervenor application, seeking release of Rs 4,100 crore. The UPPCL counsel said the 45,000 employees and their families are hit and the staffers have been boycotting work in protest at the stuck money.

Both entities have applied to intervene in the original commercial suit, by Reliance Nippon Life AMC against DHFL. During the hearing, Reliance Nippon’s counsel argued his client was a secured creditor and deserved priority over any depositor.

Earlier, judge A K Menon had allowed DHFL to make payments to banks and financial institutions in line with earlier securitisation or assignment agreements. 

DHFL’s counsel told the court they had money to pay all depositors but needed approval for this from other secured and unsecured creditors, as well as banks.