NCLT dismisses HDFC plea for initiating insolvency proceedings against RHC Holding

HDFC Limited

The National Company Law Tribunal (NCLT) on December 6 dismissed the plea of HDFC Ltd to initiate insolvency proceedings against RHC Holding, a non-banking financial company promoted by Singh Brothers -- Malvinder Mohan Singh and Shivinder Mohan Singh.

A two-member principal bench headed by NCLT President Justice M M Kumar dismissed the plea of HDFC Ltd, which had moved the tribunal to recover Rs 41 crore.

RHC Holding had contended in this matter that it is a non-banking finance company and thus it could not be brought under IBC code.

Earlier in this matter, Japanese drug major Daiichi Sankyo had moved NCLT to stay the insolvency proceedings against RHC Holding. Daiichi Sankyo had said they have a decree to recover money against RHC Holding.

The Delhi High Court has already granted a status quo over sale of assets by RHC Holding.

A tribunal in Singapore had passed the award in favour of Daiichi holding that the Singh brothers had concealed information that Indian company Ranbaxy was facing probe by the US Food and Drug Administration and the Department of Justice, while selling its shares.

The high court on January 31 had upheld the international arbitral award passed in the favour of Daiichi and paved the way for enforcement of the 2016 tribunal award against the brothers who had sold their shares in Ranbaxy to Daiichi in 2008 for Rs 9,576.1 crore.

Sun Pharmaceuticals Ltd had later acquired Ranbaxy from Daiichi. It had, however, said that the award was not enforceable against five minors, who were also shareholders in Ranbaxy, saying they cannot be held guilty of having perpetuated a fraud either themselves or through any agent.

Daiichi had moved the high court seeking direction to the brothers to take steps towards paying its Rs 3,500 crore arbitration award, including depositing the amount. It had also urged the court to attach their assets, which may be used to recover the award.