The Supreme Court reserved its order on a plea by fixed deposit holders of Dewan Housing Finance Corporation Ltd. seeking release of their deposits before the beleaguered home financier restarts lending.
The deposit holders said if DHFL was a going concern and was competent to lend and receive deposits, then it couldn't argue against paying them. A study of the relevant portions of the National Housing Bank Act, 1987, and the Reserve Bank of India Act, 1934, they argued, make it clear that “statutory repayment of deposits to petitioners ought to take preference and precedence over the contractual claims of the debenture holders”.
DHFL's resolution professional, however, said the non-bank lender wasn't taking any new deposits.
A top court bench—headed by Justice L Nageswara Rao—said that it was reluctant to interfere in the resolution process of the company but would like to know if anything can be done to take care of the depositors' concerns.
The dispute stems from the Bombay High Court and the Debt Recovery Tribunal's interim order to hold repayment to the fixed depositors. Then, earlier this month, the committee of creditors to DHFL agreed to restart lending at a rate of Rs 500 crore a month. That was expected to restore some of the value in the home financier's books as it has stopped lending for months due to liquidity stress.
After this, more than 250 fixed deposit holders moved the apex court saying that the lending could begin only after the company repays them for their deposits that have matured or are nearing maturity.
The petitioners said they were aggrieved by the orders as it affected a number of them who were members of the general public and have put their life savings in these deposits. The deposit holders include senior citizens, widows, single-earning members and persons in dire need of money, they said.
The Supreme Court hasn't given any date as of now for pronouncement of the order.
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