PMC Bank Scam's Main Accused Rakesh Wadhawan's Appeal Against Bankruptcy Court Order Rejected

Wadhawan has also recently tested positive for coronavirus while serving jail time at Arthur road central prison.

PMC Bank Scam's Main Accused Rakesh Wadhawan's Appeal Against Bankruptcy Court Order Rejected

Punjab & Maharashtra Cooperative (PMC) Bank scam's key beneficiary accused Rakesh Wadhawan, was arrested in October last year, along with his son Sarang. The accused were arrested for committing a fraud worth of ₹6,670 crore from the bank and misusing it for personal profits. Since then, the father-son duo has been serving their jail time in Arthur road central prison. Rakesh Wadhwan was the director of Housing Development Infrastructure Limited (HDIL) at the time. 

Last Friday, Rakesh Wadhawan was shifted to the Covid-19 facility of GT Hospital after testing positive for coronavirus. As per media reports, six other inmates who were in close contact with him, including his son would now get tested for the virus too. 

The accused has a history of fraudulent cases on him. In August 2019, the Mumbai bench of the National Company Law Tribunal (NCLT), was approached by another bank, Bank of India (BOI) claiming that the HDIL had failed to repay its dues of Rs. 552 crore. After this, the NCLAT admitted the case under Section 7 of the Insolvency and Bankruptcy Code (IBC). 

However, on Monday, the National Company Law Appellate Tribunal (NCLAT) has rejected HDIL's company director Rajesh Wadhawan's appeal to not initiate insolvency proceedings, bankruptcy court order. The order was passed by a thee-member bench of the NCLAT which ruled that HDIL and its promoters had been given enough opportunities to resolve the matter amicably with its lenders, but it has failed to make the payment or arrive at a settlement. HDIL had earlier argued that the NCLT had not provided it with enough opportunity to put its case forward. Following this the tribunal dismissed HDIL's argument and stated that the company had defaulted in making payments despite getting opportunities for settlements. 


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