Union government has decided to remove the management of IL&FS following serial defaults by the company and its subsidiaries to lenders.
IL&FS has Rs 910 billion of debt and is unable to repay loans in the last one month.
IL&FS has also moved the NCLT Mumbai seeking to restructure its debt under Section 230 of the Companies Act 2013. IL&FS shareholders led by LIC has decided to chip in Rs 45 billion via its rights issue, which is expected to close by October end.
A source said the government is looking to appoint a new management, which would turn around the company.
The Modi government had come under heavy criticism from the Opposition led by Congress for failing to contain IL&FS contagion.
Sources close to IL&FS said it is likely to support the application as it will help resolve all the pending issues and reach at a comprehensive solution for the benefit of all stakeholders.
The key shareholders of IL&FS include LIC, SBI and Central Bank of India.
IL&FS, where LIC is the largest shareholder with 25.34 per cent stake, has a debt burden of over Rs 900 billion.