The National Company Law Tribunal (NCLT) has given approval to the settlement of Rs 707.70 crore claim made by Fagne Sonagarh Expressway (FSEL), a special purpose vehicle of IL&FS for the expressway project, from National Highways Authority of India (NHAI).
The tribunal, chaired by members Mohammed Ajmal and V Nallasenapathy, allowed FSEL to receive the settlement amount of Rs 707.709 crore (subject to any deduction of tax as applicable and any further withholding of an amount of Rs 16.93 crores towards royalty payment).
NHAI will pay the settlement amount under the approved guidelines for resolution of road projects that have been stuck for various reasons.
As per the Road Transport and Highways Ministry’s guidelines formulated in March 2019, incomplete or stalled projects for various reasons, authorities would be able to foreclose the project’s concession agreement and pay compensation based on value of work done or 90 per cent of debt due, whichever is lower.
The settlement amount, which is to be paid by NHAI directly to the FSEL sub-contractors, “shall be deposited into an Escrow Account in any nationalised bank and shall be maintained as fixed deposits”.
“.. (The settlement amount) should not be adjusted or set off against any other dues pertaining to any bank or financial institution,” the Mumbai bench of NCLT said in the order.
NHAI Conciliation Committee approved this claim for FSEL last year and was pending for NCLT approval.
The Rs 2,000 crore 140 km project was to be delivered in May 2019.
Last month, the debt-laden IL&FS board said it has addressed Rs 32,000 crore of the group’s overall debt so far.
“The aggregate debt of Rs 32,000 crore addressed comprises about Rs 21,600 crore of debt addressed basis cash balances,” IL&FS had said in statement adding that nearly Rs 10,300 crore of additional net recovery is expected from resolution and restructuring applications filed with NCLT (Mumbai) and NCLAT, the approvals for which are awaited.
