Centre takes over management of debit-ridden IL&FS Group

Amid criticism by Congress president Rahul Gandhi, the Narendra Modi government on Monday took over the management of debt-ridden Infrastructure Leasing & Finance Services (IL&FS). The government has submitted a list of new 6-member management board led by industrialist Uday Kotak to the National Company Law Tribunal (NCLT).

The NCLT will consider petitions against the government’s move till October 31 – the next date of the hearing.

The development came a day after Congress president Rahul Gandhi accused Prime Minister Narendra Modi using public savings via LIC and the SBI bank to bailout the debt-ridden group.

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On Sunday, the Congress president had claimed that Modi had given the IL&FS group a "Gift City" project worth Rs. 70,000 crore in 2007 when he was the chief minister of Gujarat. He, however, claimed that there has not been any work on the plan till now.

The IL&FS is a vast that operates through more than 250 subsidiaries including IL&FS Investment managers, IL&FS financial services and IL&FS Transportation networks India Limited (ITNL). The group finances infrastructure projects across the country. The group has a debt of over Rs. 91,000 crore.

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Earlier, the Congress party had demanded a forensic audit of the group over the disbursement of Rs. 42,000 crore by the Modi government in the last four years after some of its subsidiaries defaulted on commercial paper repayment obligations.