AN URGENT APPEAL TO THE PRESIDENT OF INDIA: FIXED DEPOSIT HOLDERS OF DHFL (01. 04. 2020)

To
The Honourable President,
Republic of India,
Rashtrapati Bhavan,
New Delhi- 110004

Sub: an appeal from distressed Fixed Deposit Holders of Dewan Housing Finance Corporation Limited (DHFL) at the time of COVID-19 Pandemic

Respected Sir,

We, the FD holders as well as our relatives and friends, earnestly request you to help us recover the hard-earned money invested at the Dewan Housing Finance Corporation Limited (DHFL) in the form of Fixed Deposits at the time of COVID-19 pandemic.

As you know well that this shadow bank is undergoing a moratorium since it was referred to the Insolvency and Bankruptcy Court a few months ago. DHFL is now under the apt guidance of the RBI and our money is stuck due to various complex legal issues.

We have invested here in FDs depending on the AAA-rating of the company as we are totally illiterate and ignorant about other forms of investments. Moreover, we have followed the footsteps of Shri Shri Ramakrishna Mission, Missionaries of Charity, Air Force, Uttar Pradesh Power Corporation Limited (UPPCL), Uttar Pradesh Gramin Udyog etc., who also have their FD money stuck at DHFL.

It is an appeal to your honourable counsel to kindly look after this whole matter on humanitarian and philanthropic grounds and relieve us of this unbearable burden. Among us, there are many senior citizens, pensioners, ailing patients and many of us are running our family depending on the interest of our FDs. During this international lockdown, we are not only deprived of our FD interests, we are also unable to earn by performing other types of works at home.

It is a different type of “capital” punishment for us. If you please help us with your kind discretionary powers, despite being sub judice, to get out of this claustrophobic situation, we will forever remain obliged to your kind self.
In the context of worldwide pandemic, we are reiterating a mantra from Yajur Veda and Bṛhadāraṇyaka Upaniṣada for the well-being of mānavagotra:ॐ सर्वे भवन्तु सुखिनः सर्वे सन्तु निरामयाः ।सर्वे भद्राणि पश्यन्तु मा कश्चिद्दुःखभाग्भवेत् ।ॐ शान्तिः शान्तिः शान्तिः॥

P.S: The List of signatories are to be found in the following URL of “GoPetition” website:https://www.gopetition.com/signatures/an-urgent-appeal-to-the-president-of-india-fixed-deposit-holders-of-dhfl.html  

COPY TO:
1. The Honourable Prime Minister, Government of India
2. The Honourable Finance Minister, Government of India
3. The Honourable Administrator, Reserve Bank of India, DHFL, Government of India
4. The Honourable Authorised Representative acting on behalf of the Public Depositors, DHFL, Government of India

REPLY FROM THE DHFL ADMINISTRATOR (13. 04. 2020):

Subject: Email dated April 1, 2020 on behalf of Fixed Deposit Holders (“FD Holders”) of

Dewan Housing Finance Corporate Limited (“DHFL”)

Dear Sir,

1. This is in reference to your Representation dated April 1, 2020. As you are aware, the Reserve Bank of India (“RBI”) on November 29, 2019 filed an application for initiating corporate insolvency resolution process (“CIRP”) against DHFL under Section 227 read with clause (zk) of sub-section (2) of Section 239 of the Insolvency and Bankruptcy Code, 2016 (“Code”) read with Rules 5 and 6 of the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application
   to Adjudication Authority) Rules, 2019 (“FSP Rules”). On December 3, 2019, the National Company Law Tribunal bench at Mumbai (“NCLT”) commenced the CIRP of DHFL and appointed Mr. R. Subramaniakumar as the Administrator of DHFL.
2. At the outset, it is stated that the undersigned is cognizant of the genuine demands of payment by the fixed deposit holders and that all measures are being taken, in accordance with the provisions of the Insolvency and Bankruptcy Code, 2016 (IBC) to ensure that the rights of all the fixed deposit holders are not compromised/curtailed in the ongoing corporate insolvency resolution process of the corporate debtor.
3. The undersigned brings to your attention the Order of the Hon’ble Supreme Court in Vijay Kumar Mittal & Ors. v. DHFL & Ors., Civil Appeal No. 654-660 of 2020 dated January 31, 2020 (“Order”), wherein similar issues relating to payments to senior citizens, had been raised before the Supreme Court, which held that the FD Holders may raise all points and contentions before the Committee of Creditors (“CoC”) and Administrator of DHFL to be considered in accordance with law. Kindly note that the FD Holders (being represented by an authorised representative) have filed proofs of claim in relation to their deposits and have been admitted as financial creditors of DHFL.
   Consequently, the FD Holders have the right to participate and vote in all meetings of the CoC. In the event the CIRP of DHFL results in a resolution plan being accepted, the same
   would ensure to the benefit all financial creditors including the FD Holders.
4. Pursuant to the above Order of the Hon’ble Supreme Court, communications shared by other FD Holders, were brought to the attention of the CoC at its third Meeting held on February 20, 2020. Further, submissions were also made by the Authorised Representative (“AR”) of the FD Holders, Mrs. Charu Desai in relation to the demands of the FD Holders pertaining to payments for medical emergencies / senior citizens and matured fixed deposits. The members of the CoC have deliberated on the aforesaid and considered the submission of the Authorised Representative and the detailed discussions
   have been captured in the Minutes of the 3rd Meeting of the CoC which have been circulated to the Fixed Deposit Holders through their Authorised Representative. The CoC’s view in this regard has also been duly communicated to the Hon’ble NCLT in the matter of Uttar Pradesh Power Corporation Contributory Provident Fund Trust in M.A No 416 of 2020.
5. You may also note that Section 14 of the Code imposes a moratorium on the payment to any creditor, including the FD Holders, and therefore payment of any amounts to the FD Holders during CIRP is prohibited under the Code. Any such payment may amount to according preferential treatment to a set of financial creditors to the prejudice of other
   stakeholders. In accordance with law, all creditors are bound by the process laid out under the Code.
6. The interest of the FD Holders is being taken into consideration in the decision-making process and the undersigned is conscious of the genuine demands of payments with respect to the public depositors and that the entire CIRP of DHFL, which shall be undertaken in accordance with the applicable laws and regulations. Henceforth, the concerns and rights of FD Holders have always been and will continue to be taken care of
   in accordance with applicable laws.
7. All our rights are expressly reserved.

Yours faithfully,
R. Subramaniakumar
Administrator of Dewan Housing Finance Corporation Limited
For and on behalf of Dewan Housing Finance Corporation Limited
(a Company under Corporate Insolvency Resolution Process by an order dated December 3,
2019 passed by Hon’ble NCLT, Mumbai)

The Administrator has been appointed under Rule 5(a)(iii) of the Insolvency and Bankruptcy
(Insolvency and Liquidation Proceedings of Financial Service Providers and Application to
Adjudicating Authority) Rules, 2019 under the Insolvency and Bankruptcy Code, 2016. The affairs, business and property of Dewan Housing Finance Corporation Limited are being managed by the Administrator, R. Subramaniakumar, who acts as agent of the Company only and without any personal liability.