IFIN Case: NCLAT Dismisses Auditors’ Pleas Against Impleadment

The National Company Law Appellate Tribunal (NCLAT) has dismissed the pleas filed by the auditors and independent directors of IL&FS on 4th March 2020. The pleas by the auditors were filed by Deloitte Haskins & Sells and BSR & Associates LLP (KPMG India) and the individual auditors/audit partners. The bench comprising of Justice SJ Mukhopadhaya (Chairperson, NCLAT) and Justice Bansi Lal Bhat, Member (Judicial) dismissed the applications filed against the order of NCLT, Mumbai for impleadment, stating that the said order could not be deemed 'illegal'. 

The NCLT’s order for impleadment of the auditors and independent directors was passed after the Ministry of Corporate Affairs (MCA), pursuant to the investigation by the Serious Fraud Investigation Office (SFIO), moved against the auditors, under Sections 241 and 242 of the Companies Act, 2013, for attachment of their properties. The investigation was launched after a scam was unearthed in IL&FS. IL&FS Financial Services Limited is a subsidiary of IL&FS. 

At the time of publication of this article, the NCLAT website was yet to upload the order.