The Delhi High Court (HC) has suspended an order by the Reserve Bank of India (RBI) against the debt overhaul of financial services company Religare Finvest Ltd (RFL) until the next hearing.
RFL, a wholly owned unit of Religare Enterprises Ltd (REL), in a statement to ESB, said it had filed a petition with the Delhi HC against the RBI’s order that the restructuring of RFL not cannot be executed with REL because the lenders had classified RLF as a “fraud” exposure.
The Delhi HC order, dated February 18, 2022, stated: “Despite prior service, none appear for the defendant (i.e. Reserve Bank of India). After reading the impugned communication, it appears on its face that the defendant ignored the essential fact that the former promoters of REL are no longer in charge of the affairs of the applicant company or of REL. »
“In the event that the challenged order is not stayed, serious and irreparable harm will be caused to the petitioner as the banks are likely to take hasty action against the petitioner because of the disputed communication. It is therefore ordered that until ‘As of the next date, the operation of the disputed communication dated February 11, 2022 remains suspended,’ HC added.
RFL challenged the lenders’ decision to label its loans as fraudulent and said the company had been the victim of fraud perpetrated by former management.