IL&FS Financial Services MD Ramesh Bawa allegedly bending norms to favour Ansal Group, as reported by The Indian Express Wednesday, isn t the only questionable link between the two companies.
Last year, PenBrook Capital, an India-focused real estate fund, discovered that another IL&FS-linked firm had mysteriously lost post-dated cheques (PDCs) issued by Ansal Hi-Tech Townships against investments in 2014-15 of around Rs 200 crore by PenBrook, sources have confirmed to The Indian Express.
PenBrook is a joint venture of Mumbai-based real estate company Peninsula Land and Canada-based investment firm Brookfield.
Sources said IL&FS Trust Company Ltd, (now called Vistra ITCL after it was acquired by Vistra in 2016), was the trustee company that kept these cheques.
PenBrook Capital had invested around Rs 200 crore in Ansal Group s projects from funds raised in 2014 and had taken PDCs from all recipients of the fund including Ansals.
While the Ansals have not repaid the loan, the fact that the PDCs have been lost by the trustee puts the fund in a precarious situation. For, if PenBrook had the PDCs and had they been dishonoured for lack of funds with Ansal Group, the fund could have filed a case under Section 138 of the Negotiable Instruments Act, said a source.
Section 138 of the Act deals with dishonour of cheque for insufficiency of funds in the account and states that the person will be deemed to have committed an offence and can be imprisoned for up to two years or be fined up to twice the amount of the cheque, or with both.
When contacted, an Ansal spokesperson denied that any PDC was issued to secure NCDs (non-convertible debentures) of Rs 200 crore issued and allotted by Ansal Hi Tech Townships Limited. Adding that out of Rs 200 crore, outstanding amount of NCDs is approximately Rs 180 crore, the spokesperson said: For outstanding amount…negotiation/settlement are at advanced stage and Ansal Group is hopeful that the same will be materialized soon.
But records accessed by The Indian Express show otherwise.
In fact, in 2017-18, in an e-mail to PenBrook Capital, Vistra ITCL accepted that it had lost the Ansal PDCs. We are carrying out a thorough check at our Delhi office for locating the three PDCs of Ansal Hi-tech…Since the transaction was handled by ex-employees on your side and our side, it is taking time, said Vistra ITCL in its email to PenBrook.
That s not all. It also suggested alleged wrongdoing: …on grounds of suspected foul play by ex-employees and to ensure adequate action, we have yesterday evening lodged a complaint with the local police station.
Vistra ITCL in its email to PenBrook Capital suggested that the fund could pursue the case through insolvency proceedings under the Bankruptcy code instead of piecemeal security enforcement as many other real-estate loans facing default are doing.
A source at PenBrook said: While we understand that there were close financial ties between Ansal Group and some top officials of IL&FS Group, we have learnt that several IL&FS Trust employees quit after the company was acquired by Vistra in 2016. Their role will now be under the scanner as regulatory agencies look at the web of IL&FS transactions.
Emails sent to Vistra ITCL (India) and PenBrook did not elicit any response.