NEW DELHI: On Friday, the National Company Law Appellate Tribunal (NCLAT) instructed Brookfield-backed Chronos Properties to renew the bank guarantee for the acquisition of the flagship Bandra Kurla Complex property from Infrastructure Leasing and Financial Services Ltd (IL&FS).
In an interim order, NCLAT also prohibited the debt-laden IL&FS group from creating third-party rights on its headquarters until the appeal is resolved.
NCLAT emphasized the necessity for Chronos to renew the Performance Bank Guarantee to avoid disqualification in acquiring the IL&FS headquarters.
Both parties have been directed to finalize pleadings, file replies, and rejoinders by January 16, with the next hearing set for February 2.
The directive from the appellate tribunal followed an appeal from Brookfield, challenging NCLT’s recent ruling that upheld IL&FS’s right to increase the purchase expense for its headquarters property, adhering to the value-maximization principle under the IL&FS resolution framework.
While confirming IL&FS’s contractual powers, NCLT stated that Chronos’s failure to renew the bank guarantee alone doesn’t justify disqualification, granting them the opportunity to submit a fresh guarantee equal to 10% of the bid value with the tribunal registrar.
NCLAT reiterated this requirement, mandating Chronos to fulfill the bank guarantee condition promptly while maintaining interim protection over the asset until the appeal is adjudicated.
Previously, on December 1, the Mumbai bench of NCLT dismissed Brookfield-backed Chronos Properties’ ₹1,080-crore bid for the IL&FS Bandra Kurla Complex.
NCLT, in its November 28 order, dismissed Chronos’s application seeking enforcement of the ₹1,080-crore bid to acquire the IL&FS office premises. The NCLT ruled that the Letter of Intent (LoI) dated March 21, 2022, is a binding contract between IL&FS and Chronos.
However, the LoI includes clauses granting IL&FS the unilateral right to amend, modify, or supplement the LoI, including financial terms, under the court-approved resolution framework.
Furthermore, the tribunal validated IL&FS’s letter dated August 16, 2024, which elevated the consideration from ₹1,080 crore to ₹1,481 crore, ruling it cannot be nullified.
