HDFC may contest IL&FS building sale to Brookfield

Mortgage lender HDFC is contemplating approaching the Supreme Court to challenge a
decision by the National Company Appellate Tribunal (NCLAT) allowing the sale of the IL&FS
headquarters in Mumbai to Brookfield, a Canadian investor.
NCLAT had turned down HDFC’s appeal for a stay on the sale of the property located in
the Bandra Kurla Complex, which is regarded as one of the prime locations in Mumbai’s
business district. IL&FS had been permitted to sell the property after the infrastructure lending
firm went bust in India’s biggest-ever bankruptcy.
“IL&FS has already filed a caveat before the Supreme Court in this regard,” said an IL&FS
spokesperson in a response to ET’s queries. The caveat is filed to ensure that the court doesn’t
pass any order on the matter until the company is heard.

HDFC had previously offered to provide a lease rental discounting loan of 400 crore to IL&FS,
and a master facility agreement had been executed on June 25, 2018. However, in October
2018, the NCLT Mumbai bench stayed the enforcement of any security interest created over the
assets of IL&FS and its 348 group companies.
Following this order, IL&FS informed HDFC Bank, where an escrow account was set up and
requested that the amount be reversed. The NCLAT also issued a directive in May 2019
prohibiting banks from recovering any dues from the distressed IL&FS group or its companies
until their resolutions were addressed.
Meanwhile, IL&FS invited expressions of interest for the property’s sale, and the committee of
creditors approved Brookfield Private Capital entity Project Holding Seven’s (DIFC) bid of
1,080 crore by a 73.5% vote.
The sale was approved despite HDFC’s representative objecting to the agenda item as the
matter was pending before the court. In January 2022, the board approved the sale, which
includes 12,651.95 square meters of land at Plot No. C-22, in the G Block of Bandra Kurla
Complex together with the IL&FS Financial Centre.

The sale was not concluded as HDFC approached the court again in September 2022 to
restrain IL&FS from proceeding with the sale.
IL&FS has resolved debt worth 56,943 crore as of September 2022, which is nearly 93% of
the total estimated debt that it committed to resolving, according to an affidavit submitted to the

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