IL&FS case: NCLAT says pension/PF money to get priority in repayment
The National Company Law Appellate Tribunal (NCLAT) on Friday said that pension and provident funds which invested in the crisis-hit IL&FS will be the top priority in terms of repayment from the IL&FS group companies.
The funds will be on top of the priority list irrespective of which category an IL&FS group company belongs to, green, amber or red.
During the hearing on Friday, IL&FS told the appellate tribunal that lenders are cooperating with the company for restructuring of the debt. IL&FS also said that out of the 13 companies in the amber category, three would be reclassifed. After the transition of the three companies is complete, the rest of the 10 would also be brought under the amber bracket.
IL&FS has to file the status report on the 10 companies on or before the next hearing on August 8.
The new board at IL&FS had classified the IL&FS group companies into three categories -- 'green', 'amber', and 'red' -- on the basis of their ability to service debt obligations to secured and unsecured creditors. Firms classified as "green" would continue to meet their payment obligations, while "amber" category firms can meet only operational payment obligations to secured financial creditors.
Those under the "red" category are the entities which cannot meet their payment obligations at all. IANS