2019 (2) TMI 1871 - AT - Companies Law

Territorial Jurisdiction - exclusion of Offshore Group Entities from the purview of the interim order passed by this Appellate Tribunal - HELD THAT - The Board of Directors of IL FS are allowed to permit all Green Entities including the entities which may be declared Green out of the 100 entities to service their debt obligations as per scheduled repayment, which should be within the Resolution Framework as described in the affidavit dated 25th January, 2019 and subject to the supervision of the Hon ble Justice (Retd.) D.K. Jain. In so far 10 Amber Entities , prayer has been made to permit Amber Group Entities to make necessary payments only to maintain and preserve them as Going Concern . Post these appeals for orders on 12 th March, 2019 at 4.00 p.m.

Summary

Issues:
- Intervention applications by various parties
- Appointment of Hon'ble Justice (Retd.) D.K. Jain to supervise the IL&FS Group Companies' resolution process
- Exclusion of Offshore Group Entities from the interim order
- Classification of Domestic Group Entities into Green, Amber, and Red Entities
- Resolution framework for Green Entities
- Payment obligations for Amber and Red Entities
- Future resolution plans for Amber and Red Group Entities
- Concerns regarding lenders' actions affecting IL&FS Group Companies

Intervention Applications:
The judgment allowed intervention applications by various counsels representing Financial Creditors, Operational Creditors, and other secured creditors. Parties intending to file impleadment applications were directed to do so before the next date.

Appointment of Hon'ble Justice (Retd.) D.K. Jain:
The Union of India sought the supervision of Hon'ble Justice (Retd.) D.K. Jain to oversee the resolution process of the IL&FS Group Companies. After consent from Justice Jain, terms and conditions of engagement were discussed and filed in an affidavit.

Exclusion of Offshore Group Entities:
The judgment excluded 133 Offshore Group Entities from the interim order, allowing their resolution under the supervision of Justice Jain and subject to the decision of the Board of Directors.

Classification of Domestic Group Entities:
The Union of India classified 169 Indian IL&FS Group Entities into Green, Amber, and Red Entities based on their financial status and ability to meet payment obligations.

Resolution Framework for Green Entities:
The Board of Directors of IL&FS was permitted to allow Green Entities to service their debt obligations as per scheduled repayment within the Resolution Framework under Justice Jain's supervision.

Payment Obligations for Amber and Red Entities:
Prayers were made to permit necessary payments for Amber and Red Entities to maintain them as Going Concern. Concerns and objections were raised by various parties regarding these entities.

Future Resolution Plans:
The judgment intended to hear the matter concerning Amber and Red Group Entities on the next date, seeking resolution plans from the Union of India and IL&FS on constituting a Committee of Creditors and providing a timeframe for resolution.

Concerns Regarding Lenders' Actions:
Issues were raised regarding lenders marking lien on monies affecting essential payments for IL&FS Group Companies. The judgment indicated a potential order if lenders fail to release necessary payments.

Conclusion:
The judgment scheduled further proceedings for orders on 12th March 2019, emphasizing the importance of resolving the entities efficiently within a specified timeframe to avoid prolonged interim orders.