Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
The National Company Law Appellate Tribunal (NCLAT) has permitted Brookfield-backed Chronos Properties to replace its bank guarantee for the Bandra Kurla Complex (BKC) headquarters property of IL&FS, which expired earlier this month. Chronos original bid was INR 1,080 crore, later revised to INR 1,481 crore under value-maximisation framework. The tribunal allowed the company a week to submit a fresh demand draft and confirmed that its earlier interim order restricting IL&FS from creating third-party rights on the property will continue until the appeal is decided.
The National Company Law Appellate Tribunal (NCLAT) has allowed Brookfield-backed Chronos Properties to replace its bank guarantee that recently expired, keeping it in contention to acquire the Infrastructure Leasing and Financial Services (IL&FS) flagship property at Bandra Kurla Complex (BKC), Mumbai. Advertisement
A two-member bench, comprising Chairperson Justice Ashok Bhushan and Member (Technical) Barun Mitra, scheduled the next hearing for April 27. In its order, NCLAT noted that Chronos had submitted a demand draft under the interim order, which was valid only until March 15, 2026. The tribunal granted the company permission to replace it with a fresh demand draft with a validity of at least six months, specifying that this should be done within a week.
The tribunal also confirmed that its interim order from December, which had prevented the debt-laden IL&FS group from creating any third-party rights on its headquarters until the appeal is resolved, remains in force.
Chronos had earlier renewed a bank guarantee of INR 148 crore in January to continue participating in the bidding process for IL&FS BKC property. The company was initially directed by NCLAT in December to renew its bank guarantee within a month to avoid disqualification as a bidder.
The background to the dispute involves IL&FS decision to revise the purchase consideration for its headquarters property. Brookfield-backed Chronos had originally bid INR 1,080 crore through IL&FS four-tier resolution mechanism. However, IL&FS later increased the consideration to INR 1,481 crore, citing provisions in the Letter of Intent (LoI), updated valuation reports, and its obligation to maximize value under the IL&FS Resolution Framework.
Chronos challenged this revision before the National Company Law Tribunal (NCLT), arguing that the enhanced consideration was not justified. While NCLT upheld IL&FS contractual powers to revise the price, it also ruled that Chronos delay in renewing the bank guarantee alone could not result in disqualification. The tribunal allowed Chronos additional time to submit a fresh bank guarantee equivalent to 10 per cent of the revised bid value with the registrar.
Earlier, on December 1, NCLT had dismissed Chronos Properties original INR 1,080-crore bid for the IL&FS BKC property. Brookfield had contested NCLT's order upholding IL&FS right to revise the purchase consideration, emphasizing the value-maximization principle underlying the resolution process.
The matter now continues before NCLAT, with the company given a week to replace the bank guarantee and the next hearing scheduled in late April.
Source PTI
FAQ
Q1: What has NCLAT allowed Chronos Properties to do?
A1: The National Company Law Appellate Tribunal (NCLAT) has allowed Brookfield-backed Chronos Properties to replace its recently expired bank guarantee, enabling the company to continue in the race to acquire IL&FS flagship Bandra Kurla Complex (BKC) property in Mumbai. This ensures Chronos remains a valid bidder under the ongoing resolution process.
Q2: What is the timeline for submitting the new bank guarantee?
A2: Chronos has been given one week from the NCLAT order to submit a fresh demand draft. The new bank guarantee must have a validity of at least six months, ensuring that it meets the tribunal's requirements for the bidding process.
Q3: What is the value of Chronos bid?
A3: Chronos originally submitted a bid of INR 1,080 crore, which was later revised to INR 1,481 crore as part of IL&FS value-maximization framework. The increase reflects updated property valuations and IL&FS legal provisions to maximize returns under the resolution plan.
Q4: Does the interim order restricting IL&FS still apply?
A4: Yes. The interim order issued by NCLAT in December 2025 remains in force. It prevents IL&FS from creating any third-party rights, such as selling or leasing the BKC property to others, until the ongoing appeal is resolved. This protects Chronos position as a bidder.
Q5: Why was there a dispute over the bid amount?
A5: IL&FS revised the purchase consideration for the BKC property from INR 1,080 crore to INR 1,481 crore, citing updated valuation reports and its obligation to maximize value under the IL&FS Resolution Framework. Chronos challenged this revision, arguing that the increase was not justified under the original bidding agreement.
Q6: What did NCLT rule earlier in this matter?
A6: The National Company Law Tribunal (NCLT) upheld IL&FS contractual right to revise the property price. However, it also clarified that Chronos delay in renewing the bank guarantee could not alone lead to disqualification, and allowed additional time for submitting a fresh guarantee equivalent to 10% of the revised bid value.
Q7: When is the next hearing scheduled?
A7: The next hearing before NCLAT is scheduled for April 27, 2026, where the tribunal will further examine the appeal and the status of Chronos bid.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
