HDIL arm faces bankruptcy proceedings

Mumbai: The subsidiary of Mumbai-based developer

HDIL

has gone into

bankruptcy proceedings

following a Rs 250-crore default in its Goregaon project to Union Bank of India.

The

National Company Law Tribunal

(NCLT) on Thursday admitted an application from Union Bank of India for

Guruashish Constructions

, an HDIL subsidiary, and has appointed

insolvency resolution professional

to carry out the resolution process.

HDIL, in a statement issued to the stock exchanges, said that it will “file an apt reply and will take an appropriate measure, as and where required in the proceedings with the tribunal (NCLT) and the appellate authorities”.

Guruashish Constructions had mortgaged two land parcels owned by

Privilege Power and Infrastructure

, another subsidiary of holding company to raise loans. The appointment of an insolvency professional means that the board of directors of the company stands dissolved. The insolvency professional will perform the job of the chief executive and a committee of creditors will be constituted which will act as the board of directors and look into resolution proposals.