The central government proposed the name of retired Justice DK Jain to supervise the sale of the debt-ridden IL&FS group.
Justice Jain is a former judge of the Supreme Court and served as chairperson of the Law Commission of India.
The government made the proposal to a National Company Law Appellate Tribunal bench headed by retired Justice SJ Mukhpadhyay, while also assuring that it will submit a road map for resolution of the debt owed by the group and its subsidiaries.
“Learned Solicitor General of India and learned counsel for the IL&FS submit that both the parties have agreed for appointment of a retired Hon'ble Supreme Court Judge for such supervision,'' NCLAT said in its order asking for Justice Jain to be approached for his consent for the role.
The IL&FS group has defaulted on loan payments and bonds since August last year, sparking fears of a contagion in the financial markets and a credit crunch among non-bank lenders. Sale of the IL&FS' assets is crucial to revive the group—which has a debt burden of around $12.6 billion.
The appellate tribunal was hearing a petition filed by the Ministry of Corporate Affairs and IL&FS. Earlier, while passing an order on Jan. 1, the tribunal permitted the government to reopen and recast the accounts of IL&FS and its subsidiaries—IL&FS Transportation Networks Ltd. and IL&FS Financial Services—for the past five years.
The tribunal had on Oct. 15 stayed all proceedings against the IL&FS group and its 348 firms until further orders, over an urgent petition moved by the government. The ministry approached the appellate tribunal after the Mumbai bench of National Company Law Tribunal turned down its plea to grant a 90-day moratorium.
The NCLT had on Oct. 1 suspended the board of IL&FS on a plea by the government and authorised reconstitution of the board by appointing seven directors two days later.
The next date of hearing is Feb. 11.
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