If SARFAESI (2002) is there, why fluid IBC (2016) is applied to the DHFL?

Posted on 10/03/2023 (IST 01:46)

Updated on 14/03/2023 (IST 00:55)

When we first viewed the acronym “SARFAESI”, we mistook it as “Sarfaroshi”, i.e., revolution. We may have to take recourse to Freudian psychoanalysis in order to interpret our (mis-)perception. In association to this, We recall the song written by Bismil Azimabadi and immortalized by the Indian revolutionaries: “sarfaroshī kī tamannā ab hamāre dil meñ hai, dekhnā hai zor kitnā bāzū-e-qātil meñ hai” ⤡ (The desire for revolution is in our hearts, let’s see how much strength the enemy has!). This misperception proves our love for our country but not for the government. In the post-independent era, in the contemporary scenario under the BJP rule, this song is interpreted differently. The revolutionary sacrifice for the country and independence have got different connotation within the ambit of Orwellian state.  The ruling party has forgotten this ideal of revolution and has instead followed the path of their gurus, who filed mercy petitions to the British colonialists. “Atmanirbharta” (self-reliance) is now interpreted as dependence on other countries—taking loans from WB, IMF, WTO and to sell all the governmental properties to private enterprise. Thus, government is shunning off its responsibilities to run a state with self-reliant, decentralized economy. When they are talking about “double-engine Sarkar or government”, i.e., one party rule over the state and the centre, they are actually destroying the socialist and federal ethos as depicted in the Indian Constitution. “Deshdrohita” or sedition is only limited to the nafrat (hatred/intolerance) between two communities. When Rahul Gandhi is saying “nafrat ke bajar mein mohabbat ki dukaan kholna hai” (The shop of love must be opened in the market of hatred), he couldn’t escape the buyer-seller relation in the shop of love and love has become an exchangeable commodity. Thus, love is also a conditional love since its antonym, hatred, is not possible without conditions.

In the context of the collapse of the non-banking financial institutions, appearance of shell (de facto)companies, plantation companies and rampant stock manipulation, the Government of India, in 2002, had decided to set up the Serious Fraud Investigation Office (SFIO) , a multi-disciplinary organization to investigate all kinds of corporate frauds.

To

Mrs. Nirmala Sitharaman,

The Honourable Finance and Corporate Affairs Minister,

The Government of India

Sub: If SARFAESI (2002) is there, why fluid IBC (2016) is applied to the DHFL?

Dear Madam,

We wish to open our file with the following pariprasna (Śrīmadbhagavadgītā, 4.34):

·       Why did not the concerned decision-makers regarding the Dewan Housing Finance Corporation Limited (DHFL) insolvency approach the SFIO⤡first?

The documentation of the narrative of the DHFL Scam is given as follows:

A WHITE PAPER ON THE DEWAN HOUSING FINANCE CORPORATION LTD. (DHFL) VIEW HERE ⤡

THE CHRONOLOGY OF THE DHFL SCAM VIEW HERE ⤡

·       Why DHFL’s old promoters were not allowed to participate in the RBI-appointed CoC for DHFL’s resolution process?

We, the DHFL Victims, have found the following cracks in the resolution process conducted by the RBI-appointed CoC for DHFL:

SMELLING THE RAT IN THE DHFL-COC RESOLUTION PROCESS: A LETTER TO THE PRESIDENT OF INDIA VIEW HERE⤡ 

PLEASE COMPOSE AN OBITUARY FOR THE RBI-APPOINTED COMMITTEE OF CREDITORS (COC) FOR THE DHFL VIEW HERE⤡ 

·       After the so-called “successful resolution”(?) process in favour of Mr. Ajay Piramal, the “irregularities” and illegality of the DHFL CoC (cf. NCLAT Second Verdict on 27/01/2022) have been exposed. Hence, we had smelt the rat and the cat is already out of the bag:

You’re all caught up: RBI-appointed CoC for DHFL VIEW HERE ⤡

·   After NCLT’s First Order (19/05/2021) on the DHFL case, when Mr. Ajay Piramal and others hurriedly jumped to the NCLAT to revert back the previous order, it was said that:  NCLT has set a dangerous precedent in the DHFL case  VIEW HERE ⤡ (As reported on 26^th May, 2021 ©Mint). Whether a judgement or legal precedent is “good” or “bad” in any sense of these two terms from one perspective, that does not matter for getting justice. It may be a “bad” precedent from the ruler’s gaze, but we must call a spade a spade. 

·       Do we really need a new code, i.e., the IBC, which has been amended 30+ times within the span of five or six years? Couldn’t we solve the DHFL problem within 45 days by deploying the SARFAESI Act (2002), especially when the old promoter himself was ready to pay all his creditors the full amount multiple times (on 14/12/2020 and 04/01/2021)? [cf. “Bankruptcy will not void personal guarantees”: The Hon’ble Supreme Court, 21/05/2021 ⤡] Is it not the decision-makers’ exclusion of the old promoters’ rights, at a time when other business tycoons, with huge loans, are roaming around freely like the rapists of Bilkis Bano? Even more, the IBC is not applicable to an ongoing, profitable concern like DHFL.

Non-Applicability of IBC 2016 on DHFL Scam (with relevant documents for litigation)  VIEW HERE ⤡

·       Why has the registration and regulation of asset reconstruction companies (ARCs) not been deployed in the case of the DHFL Scam? The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) provides access to the banks and financial institutions covered under the Act for the recovery of secured debts from the borrowers without the intervention of the Judiciary at the first stage. Securitisation Appeals (SAs) can be filed with the DRTs by the aggrieved party against the action taken by the secured creditors under the SARFAESI Act. Why was it not filed or deployed in the case of the DHFL Scam?

·       The Standing Committee of the Parliament as well as you yourself have questioned the efficacy of the CoC and its conduct in insolvency proceedings:

Standing Committee on Finance raps IBC over unsustainable haircuts, says 13,000 cases worth Rs 9 lakh crore pending VIEW HERE ⤡ (As reported on August 03 2021, ©Moneycontrol)    

IBC: Govt. working with RBI on CoC’s conduct VIEW HERE ⤡ (As reported on 27th August, 2021 ©The Hindu, PTI)  

Impossible to accept 95% haircuts for banks under IBC: Sitharaman  VIEW HERE ⤡ (As reported on 1st October, 2022 ©The Hindu) 

However, now, after so many days, we consider your statements as mere lip-service since no substantial work has been done to solve this issue after the NCLAT’s second verdict (27/01/2022) on the DHFL matter.

·       Why is not the perfectly plausible SARFAESI being applied by the banks in the case of 50+ wilful superrich defaulters, who are moving scot free and whose loans have been waived off in the name of “writing off” in the context of the Orwellian dystopia?

Banks Technically Write Off Over Rs 68,000 Cr Loans, Choksi  Among 50 Top Wilful Defaulters: RTI  VIEW HERE⤡ (As reported on 28th April, 2020 ©News 18)

38 wilful defaulters including Nirav Modi, Vijay Mallya fled India in last 5 years VIEW HERE ⤡ (As reported on 15th September, 2020 ©India Today)

Top 100 wilful defaulters owe lenders Rs 84,632 crore VIEW HERE ⤡ (As reported on 9th February, 2021 ©Economic Times)

Top 50 wilful defaulters in India owe Rs 92,570 crore to banks: MoS Karad VIEW HERE ⤡ (As reported on 20^th December, 2022 ©Business Standard)

Here Is the List of Top-50 Wilful Bank Defaulters; Bad Debts of Rs10.09 Lakh Crore Written Off in Past 5 Years, Says Govt VIEW HERE ⤡ (As reported on 23^rd December, 2022 ©Moneylife)

·       The common people do not have access to the PM CARES fund and Electoral Bonds’ audit books– no RTI is possible to know the hypothetical or otherwise conditional donation collected by the political parties. The “black money” has become white through the process of donating to these two funds. The present ruling party’s assets know no bounds. The figures are astonishingly astronomical and quite beyond the grasp of the common mass imagination. We repeat: No RTI can be filed to know the name of the donor(s) and recipients in any of these cases. Why such opacity on the part of the government?

Indian kitty in Swiss banks jumped 50% to over ₹30,000 crore in 2021 VIEW HERE ⤡ (As reported on 16th June, 2022 ©The Hindu)

BJP’s Declared Assets Increased By 627% in 10 Years: ADR Report VIEW HERE ⤡ (as reported on October 17 2017 © BloombergQuint)

BJP highest earner in FY19 at Rs 2,410 crore; TMC’s income spikes 3,628%  VIEW HERE⤡(as reported on January 16, 2020 © BusinessToday)

BJP’s assets increased by 22% in 2017-18, Congress’ down by 15%: ADR VIEW HERE ⤡ (as reported on 01 Aug 2019 © Economic Times)

Amit Shah’s Son Delayed Filings, His Total Income Rose By 15000% From 2014-19: Report   VIEW HERE⤡ (As reported on 5 Nov 2019 ©The Logical Indian)

Amit Shah’s son’s 6 crore company got credit facility worth ₹97 crore, says CongressVIEW HERE ⤡ (As reported on 11 Aug 2018, ©National Herald)

BJP accounts for nearly 70% of assets declared by national parties: ADR report VIEW HERE ⤡ (As reported on 28^th January, 2022 ©The Hindu)

BJP India’s Richest Political Party In 2019-20, Congress Slipped To Third: Report VIEW HERE ⤡ (As reported on 28^th January, 2022 ©abp Live)

Delhi BJP councillors declare up to 300% jump in assets: ADR report VIEW HERE ⤡ (As reported on 30^th November, 2022 ©Moneycontrol)

·       Parallel to the rising assets of the ruling party, public money is at stake in the PSUs/PSBs owing to the rapid privatization of all the sectors for promoting crony and monopoly capitalism⤡. 

This is causing a huge rise in NPAs or bad loans of the Banks in the last 8+ years. It leads to concentration of wealth and rampant bankruptcies, unforeseen in post-Independent India. Thus it may be inferred that there  is one-to-one correspondence between BJP’s astronomically increasing assets and abrupt bankruptcies in India ⤡.

8 Biggest Bankruptcies in India in the Last 10 Years  VIEW HERE ⤡ (As reported on 30^th March, 2021 ©Trade Brains)   

Fact check: Nine public sector banks could collapse because of bad loans VIEW HERE ⤡ (As reported on 15^th July, 2017 ©Newslaundry)

·       If India’s external debt has declined as per the RBI in end-June 2022⤡, why the inflation rate accelerated to 6.50% in January 2023 as per the Forbes’ Report⤡? The national debt per citizen stands at 1,37,000 rupees. This contradiction proves that there is a data denial, data paucity, data opacity despite the fact that there are two major institutions of the Government of India to take care of such statistical data: Indian Statistical Institute and the National Sample Survey.

INDIA’S DEBT CLOCK VIEW HERE ⤡

·       The Recovery of Debts and Bankruptcy Act, 1993 (RDB Act) provides speedy redressal to lenders and borrowers through filing of Original Applications (OAs) in Debts Recovery Tribunals (DRTs) and appeals in Debts Recovery Appellate Tribunals (DRATs). Why has it not been applied to recover the dues of the DHFL? 

After viewing this miserable scenario, we are bound to address our uncomfortable questions to the “undemocratic” government. All the dissenters’ voices are suppressed without justice in today’s India. We, the Indian citizens, are condemning such a vulnerable situation and are suffering from anxiety disorders.

INDIA WOUNDED: A BIRD’S EYE VIEW VIEW HERE ⤡

The above document clearly shows India’s miserable condition under the Modi Raj. When you are busy talking about the Hindu-Muslim hatred, the hungry, debt-ridden India is ridiculed by our foreigner friends. We cannot answer their pertinent questions regarding the governmentality of the BJP regime.

We seek your kind and hastened help in this very regard, i.e., the DHFL pandemonium. 

Yours Sincerely,

Dr. Debaprasad Bandyopadhyay

Mrs. Rupa Bandyopadhyay

Mr. Akhar Bandyopadhyay

A Victimized Family of Bewildered, Beleaguered, Perplexed, Anguished, Anxious, Hapless, Helpless and Ailing DHFL FD Holders

ON BEHALF OF ALL ANGUISHED, AILING DHFL FD, NCD AND SHAREHOLDERS  [USUAL DISCLAIMERS APPLY] 

बहुजनहिताय बहुजनसुखाय च॥

(“For the happiness of the many, for the welfare of the many”) 

COPY TO:-

1.  MR. SHAKTIKANTA DAS (MA History), THE HONOURABLE GOVERNOR, THE RESERVE BANK OF INDIA

2.  DR. BHAGWAT KISHANRAO KARAD (A Paediatric Surgeon), THE HONOURABLE MINISTER OF STATE, MINISTRY OF FINANCE, GOVERNMENT OF INDIA

3.  SHRI PANKAJ CHAUDHARY, HONORABLE UNION MINISTER OF STATE, THE MINISTRY OF FINANCE, GOVERNMENT OF INDIA

UPDATE: The Finance Ministry on 13/03/2023 forwarded our letter to the concerned authority.

We replied to the above with the following text: