NCLAT Gives Vikram Bakshi Final Chance To Settle Dispute With HUDCO Before McDonald's Settlement

McDonald’s estranged joint venture partner Vikram Bakshi has been given the final chance by the National Company Law Appellate Tribunal (NCLAT) to settle his dispute with the Housing and Urban Development Corporation (HUDCO), before a settlement between McDonald’s and Bakshi.

HUDCO has sought a part of the Rs 195 crore settlement amount payable to Vikram Bakshi by McDonald’s.

In its plea before the NCLAT, HUDCO contended that the settlement goes against an order passed by the Debts Recovery Tribunal (DRT) on February 2, 2016, which had restrained Bakshi from transferring or creating any third-party interests in shares held by him in Connaught Plaza Restaurant Ltd (CPRL).

The DRT order was passed in a case pertaining to the recovery of a loan amount of around Rs 63 crore extended by HUDCO to Bakshi’s Ascot Hotels and Resorts Pvt Ltd in 2006. HUDCO had moved the DRT in 2011, after its loan became a Non-Performing Asset.

After HUDCO submitted a plea urging for the attachment of Bakshi’s share in CPRL in 2013, he promised to not transfer his stake in CPRL. The DRT too recorded the same in its order.

In 2015, the DRT ruled that HUDCO was entitled to recover a sum of Rs 68,62,91,032, along with a 14% simple interest per annum, from the date of the order until the recovery of that amount from Ascot Hotels and Resorts, Vikram Bakshi, Madhurima Bakshi as well as Vikram Bakshi & Co Pvt Ltd.

During execution proceedings, the DRT restrained Bakshi from transferring his 3,100 shares in CPRL, and after the settlement deal was announced, HUDCO approached the DRT.

Later, the DRT asked McDonald’s to deposit the proceeds of the settlement with it.

HUDCO claimed that any amount payable to Bakshi must be deposited with the DRT by McDonald’s for settlement of dues.

However, Bakshi’s counsel claimed that Bakshi has already paid most of the amount to HUDCO.

Bakshi’s counsel disputed HUDCO’s claim and stated that his client had already deposited Rs 66 crore with the DRT, as against the original dispersed amount of Rs 57 crore.

This was contested by HUDCO’s counsel who denied having reached any settlement in the matter.

He stated that HUDCO’s claim of Rs 195 crore excluded the sum of the Rs 66 crore already paid by Bakshi.

Taking into account the conflicting claims made by HUDCO and Bakshi, the NCLT directed Bakshi to sit across the table with HUDCO and settle the dispute.

The matter is scheduled to come up for hearing at the NCLT on July 10.