Even as mutual funds have been impatient regarding their dues from crisis-hit DHFL, which will soon go the insolvency way, legal experts say that it is unlikely that the funds would be the first in the list of creditors to get back their dues.
They are also of the view that the fund houses would have to take a haircut, much against the their wish of incurring any such paring down of their refunds.
Mutual fund houses want the Wadhawans, the promoters of Dewan Housing Finance Corp Ltd (DHFL), to arrange funds and pay back their dues and are likely to raise the issue in the committee formed by the Reserve Bank of India (RBI) to administer DHFL.
“I don’t think it is possible legally. Any resolution has to be comprehensive, it cannot be that one party gets the money out of the system, and obviously if the CIRP process has started, then any payment has to be as per the IBC (Insolvency and Bankruptcy Code) regulation itself, ” said Manoj Kumar, a partner at law firm Corporate Professionals.
“The company cannot redeem any part, during the CIRP. even if it happens before the commencement of the CIRP (Corporate Insolvency Resolution Process), even then, if they make the payment, it will be made on a priority as per the provisions of the IBC,” he added.
Sector experts are of the view that fund houses cannot themselves prsessure the promoters for refund. They feel it is too late for them to take up the matter as the RBI has superceded the company board and will now move for insolvency.
Last week, citing governance concerns, the RBI superseded the Board of Directors of the housing lender and said that it intends to shortly initiate the process of resolution of the company. Promoters hold around 39 per cent stake in DHFL.