Bank of India classifies Rs 616-crore loan to Rolta India Ltd as fraud
Bank of India has classified its Rs. 616.30 crore exposure to debt-ridden Rolta India Ltd as fraud, according to a regulatory filing submitted under SEBI (LODR) Regulations, 2015. The disclosure comes while the company undergoes the Corporate Insolvency Resolution Process (CIRP) under India’s bankruptcy law.
Rolta India’s Insolvency Status
The National Company Law Tribunal (NCLT), Mumbai Bench, admitted Rolta India into insolvency in January 2023 following a petition by Union Bank of India. The company owes Rs. 14,000 crore to its different creditors, including Rs. 13,700 crore to its secured and unsecured creditors. Among secured creditors, Union Bank of India has the highest voting share of 17.21% with admitted claims of Rs. 2,262 crore. Among unsecured creditors, Citicorp International Limited (as trustee) has the highest claims of Rs. 4,613 crore and a voting share of 35%.
The company’s insolvency follows failed debt restructuring efforts under the RBI’s Sustainable Structuring of Stressed Assets (S4A) scheme. Mamta Binani has been appointed as the resolution professional in the case by NCLT.
Patanjali Ayurved is one of the companies that have shown interest in bidding for Rolta India, a Mumbai-based IT and engineering solutions firm.
Rolta India has faced financial distress for years, with multiple lenders reporting NPAs. Its insolvency case is among several high-profile resolutions under IBC. Earlier, on multiple occasions, insolvency proceedings were initiated against Rolta India by other creditors. In May 2021, NCLT had admitted an insolvency petition against Rolta India filed by an ex-employee. The matter was settled under Section 12A in August 2021.
Before that, Value Partner Greater China High Yield Income Fund and Pinpoint Multi-Strategy Fund in 2019 had filed an insolvency petition claiming a default of around Rs. 1,060 crore. However, the Bombay High Court had set aside the insolvency proceedings on technical grounds.
Rolta is a provider of IT solutions to a diverse set of clients, including Federal and State Governments, in defense and homeland security, utilities, power, financial services, manufacturing, retail, and healthcare.
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