The Hindu Business Line : BIFR pulls up IDBI in Binny case

THE Board for Industrial & Financial Reconstruction (BIFR) has pulled up the Industrial Development Bank of India (IDBI) for not following its instructions and causing undue delay in the case of Binny Ltd.

"IDBI's action in delaying the distribution of funds irrespective of the funds deposited with it despite clear instructions given, is not appreciated," the Bench observed. Further, IDBI could not appropriate or set-off their dues against other claims, it said.

BIFR Bench also noted that the valuation of the property, proposed to be transferred to Binny's subsidiary, Binny Real Estate & Assets Developers Ltd (BREAD), at Rs 79 crore would have to be approved by the secured creditors.

"If the sale of the property took place without full payment, the interest of the workers might be affected as the assets would be gone without the workers receiving full payment of their dues. IDBI, the operating agency (OA), needs to examine this issue," the bench said.

Considering the case, the Bench directed the company, its promoters and co-promoters, to transfer or deposit Rs 20 crore in a `no-lien account' with IDBI in the name of Binny Ltd. Besides, Binny Ltd would also give a letter stating that the amount would become a `lien' marked deposit in case a scheme was sanctioned.

The company was directed to take up with all the concerned parties, settle with the workers and submit their final and fully tied-up proposal within a stipulated time frame. The Bench directed the secured creditors to take a final view including on the valuation and transfer price of the assets.

IDBI has been directed to submit its report within a stipulated time frame.

"If the company's proposal is acceptable to all, a final scheme would be submitted to the Bench for consideration and circulation. However, if no proposal is received by the given time frame, the Bench might consider winding up orders on file," the BIFR bench said.

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