63 Moons moves NCLT to ensure DHFL recovery benefits to creditors, NCD holders

Mumbai, Dec 31 : 63 Moons Technologies on Thursday said it has filed an application with the National Company Law Tribunal (NCLT), Mumbai, seeking that the benefit of avoidance applications for approximately Rs. 30,000 crore filed by DHFL administrator under section 66 of Insolvency and Bankruptcy Code (IBC) should come to the Committee of Creditors (CoC), including NCD holders, who are the actual sufferers of the default.
63 Moons stated that it held over Rs. 200 crore non-convertible debentures (NCD) of DHFL.
Presently, as per the resolution plans submitted by Resolution Applicants, the benefit or the recovery amount arising from the avoidance applications will go to Resolution Applicant. This same resolution plan has been put up for voting.
In a statement, the company said the application made by 63 Moons on Thursday came for hearing before the tribunal which adjourned the same to January 13, 2021 for final hearing, while directing the parties to complete pleadings.
63 Moons said it is hopeful that any clause in the resolution proposal, which is contrary to the Request For Proposal and IBC should be struck down by NCLT. However, the CoC opposed the application. This is perhaps because the majority of the CoC comprises banks, which will have recourse to personal guarantees by promoters in addition to the 30 to 35 per cent realization of principal under the proposed resolution plans.
While on the other hand, the NCD holders, who have no such recourse, will be left high and dry with only 30 to 35 per cent realization if future recoveries from fraudulent transactions are allowed to go to the resolution applicants, instead of the creditors.