The settlement between McDonald's and its estranged Indian associate Vikram Bakshi over the sale of his shares in Connaught Plaza Restaurants seems to have hit a hurdle as the NCLAT said it wanted review the agreement reached between the two. The appellate tribunal may even reverse the pact between the two in the absence of its nod, said a media report.
The National Company Law Appellate Tribunal (NCLAT) observed that McDonald's and Bakshi had failed to obtain its permission for the settlement of the six-year-old dispute, said a report in The Economic Times.
The deal appeared to violate an order of the Debt Recovery Tribunal (DRT) in proceedings initiated by state-owned Housing and Urban Development Corporation (HUDCO) against Bakshi, the report said.
A two-member NCLAT bench headed by Chairperson Justice S J Mukhopadhaya also asked Bakshi not to leave the country without its permission, reported PTI.
The appellate tribunal said the settlement reached between McDonald's and Vikram Bakshi was "prima facie" violation of the DRT order.
"We find that parties (Bakshi and McDonald's ) have reached agreement …. Which is prima facie against the Interim order of Debt Recovery Tribunal (DRT). We are of the view that parties should not implement such agreement nor leave the country without intimating DRT or this Tribunal," said the NCLAT.
When contacted, Bakshi said: "We have yet to see the order. Once it is available my legal team shall review it and thereafter we shall take a considered decision".
The appellate tribunal was hearing an intervention plea by HUDCO, claiming dues of Rs 195 crore from Bakshi.
On 22 August, the NCLAT had granted Bakshi a "last chance" to settle his dispute with state-owned HUDCO, which is claiming Rs 195-crore dues from him.
The NCLAT had admitted HUDCO's plea on 15 May 2019 in the ongoing cases of Bakshi and McDonald's India Pvt Ltd (MIPL).
After reaching an out-of-court settlement for an undisclosed amount, Bakshi and MIPL had approached the NCLAT to withdraw cases filed against each other for management control of CPRL.
However, HUDCO had opposed their settlement, saying Bakshi and his related entities owed Rs 194.98 crore, which Debt Recovery Tribunal had also directed Bakshi to pay.
In July this year, the NCLAT had directed Bakshi to file an affidavit within a week detailing the amount he has received from the sale of his shares in CPRL as part of his settlement with the US-based fast food chain.
— With PTI inputs
Updated Date: Sep 19, 2019 16:57:17 IST