IL&FS: NCLAT allows banks to proceed against ex-IL&FS directors not on new board

The National Company Law Appellate Tribunal (NCLAT) has allowed state-owned Canara Bank and Indian Bank to pursue proceedings against former IL&FS directors, who are not part of the new board, to declare them as wilful defaulter. However, the appellate tribunal said those directors who are part of the new board of Infrastructure Leasing & Financial Services (IL&FS) and its various subsidiaries after October 1, 2018, would remain protected. "We are of the view that this protection shall extend to Professional Directors who have been reappointed in IL&FS and its subsidiaries who are the part of the present board. With respect to IL&FS and IL&FS Group...we grant leave to the bank to make an application for proceeding against them," said a two-member NCLAT bench comprising Chairperson Justice Ashok Bhushan and Member Barun Mitra. The government had appointed a new board of IL&FS on October 1, 2018, after a Rs 90,000 crore debt surfaced, which had then sent ...