Kapil Wadhawan opposes DHFL’s plea to discharge company from case

Kapil Wadhawan, erstwhile promoter of Dewan Housing Finance Ltd (DHFL), has moved the Bombay High Court to oppose the stressed mortgage financier’s plea to discharge the company's name and drop proceedings against it in an ongoing investigation by the Central Bureau of Investigation (CBI).

On Monday, Wadhawan, through his lawyers, argued in the Bombay High Court that the scheme mentioned in the Insolvency and Bankruptcy Code (IBC) provided for a mechanism and checklist which was required to be completed before it could be said that the successful resolution applicant had taken over the insolvent company.

Last week, DHFL had approached the High Court to challenge the special CBI court order of August 20, which had given partial relief by discharging the interim monitoring committee but had rejected DHFL’s prayer to discharge it from the case.


The company has so far argued that since it had been taken over by Piramal Capital & Housing Finance Ltd, it should be absolved from all earlier liabilities.

The lawyers representing Wadhawan further argued that the resolution plan had timelines and included payments and that process is not over yet. Hence, in the event DHFL is discharged from the case, it will adversely impact the prosecution's case.

Justice SK Shinde has adjourned the matter for a further hearing on October 7.

So far, the DHFL has argued in its petition that “Section 32 (A) of IBC - which came into effect on December 28, 2019 - lays down a mandatory direction for a Corporate Debtor (DHFL) to be absolved from all the liabilities from all criminal offences committed before the commencement of CIRP.”

In this case, Senior Advocate Ravi Kadam is appearing for DHFL, while special counsel Hiten Venegavkar represents CBI. Kapil Wadhawan has filed an intervention application through the law firm Rashmikant & Partners.

In July, the National Company Law Tribunal (NCLT) had permitted Piramal Capital and Housing Finance to take over DHFL.

Piramal has offered to pay Rs 35,250 crore to DHFL’s creditors.

Currently, of its around Rs 87,000 crore debt, the company owes close to Rs 40,000 crore to banks.