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NCLT dismisses HDFC plea for initiating insolvency proceedings against RHC Holding

Press Trust of India  |  New Delhi 

The (NCLT) Thursday dismissed Ltd's plea against RHC Holding, observing that the non-financial company does not come under the purview of the IBC Code.

A two-member principal bench headed by NCLT Justice M M Kumar dismissed the plea of Ltd, which had moved the tribunal to recover an amount of Rs 41 crore.

RHC Holding, promoted by Malvinder and Shivinder Mohan, had taken a loan of Rs 200 crore from in April 2016. had paid the interest for the first quarter on time but later started defaulting on it.

According to HDFC, even after adjusting the proceeds from the sales of the pledged share, a substantial amount of Rs 41.09 crore remained due.

To recover the remaining amount, HDFC filed a plea against before NCLT.

Subsequently, Japanese drug had moved NCLT to stay the proceedings against

The tribunal Thursday observed that RHC Holding was a non-company as per the certificate of registration issued by the regulator RBI.

"Respondent company being a non-banking company remain outside the purview of the code (Insolvency and Bankrutcy Code)," NCLT said.

With RHC Holding "having excluded from the definition of the corporate person, the present application filed under section 7 of the code against a financial service provider is not maintainable".

had claimed "a decree to recover money against RHC Holding".

The has already granted a status quo over sale of assets by RHC Holding.

A tribunal in had passed the award in favour of Daiichi holding that the Singh brothers had concealed information that Indian company was facing probe by the and the Department of Justice, while selling its shares.

The high court on January 31 had upheld the international arbitral award passed in the favour of Daiichi and paved the way for enforcement of the 2016 tribunal award against the brothers who had sold their shares in to Daiichi in 2008 for Rs 9,576.1 crore. had later acquired from Daiichi.

It had, however, said that the award was not enforceable against five minors, who were also shareholders in Ranbaxy, saying they cannot be held guilty of having perpetuated a fraud either themselves or through any agent.

Daiichi had moved the high court seeking direction to the brothers to take steps towards paying its Rs 3,500 crore arbitration award, including depositing the amount. It had also urged the court to attach their assets, which may be used to recover the award.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, December 06 2018. 19:10 IST