New Delhi: Hours after the National Company Law Tribunal allowed the government to takeover debt-ridden Infrastructure Leasing & Financial Services Ltd (IL&FS), finance minister Arun Jaitley went on the attack and blamed the Congress party for fearmongering about the government’s move.
In a series of tweets, Jaitley indirectly held the Congress responsible for prolonging the crisis at the company and accused it of spreading “disinformation about the Government’s possible moves in relation to the private sector company IL&FS.”
“The Congress is a national saboteur. It wants to sabotage India’s economy by allowing a situation in relation to a company to persist, expand and become unmanageable. It lacks statesmanship and vision,” he wrote.
The NCLT on Monday approved the takeover of IL&FS by government nominees, saying the mismanagement at the crisis-ridden company was being conducted in a manner “prejudicial to public interest" and approved a Centre’s proposal to let a six-member team headed by Uday Kotak to head the new board.
The company owes between Rs 55,000 and 60,000 crore to banks out of the total debt, the management had informed earlier. The total long-term exposure of the IL&FS group stands at around Rs 91,000 crore.
The group is facing a serious liquidity crisis and has defaulted on interest payment on various debt repayments since August 27, stoking fears of a market crash and taking a toll on equity mutual funds.
Jaitley said several entities, including Life Insurance Corporation – one of the largest shareholders in IL&FS - have invested heavily in the company over the years. "Do I start calling all these investments today 'a scam' as per 'the perverted Rahul Gandhi school of thinking?'" the Finance Minister wrote on Facebook.
He claimed that in fact, it is a section of the Congress leadership that has been urging him to enable investments in the IL&FS and save the company.
“A senior congress leader, Prof. K.V. Thomas, who is a former Union Minister and has been the Chairman of the Public Accounts Committee, has written to me on 20th September, 2018 making such a request,” he said, adding that the letter demolishes every word that Rahul Gandhi and his coterie has been spreading.
“It may be advisable for Rahul Gandhi to get some ‘words of wisdom’ from Prof. K.V. Thomas. The Congress Party must remember that ‘the days of crony capitalism are over.’ The NDA Government deals with such challenges objectively and professionally,” he said.
Jaitley also defended loan write-offs by public sector banks, saying they do not lead to loan waivers and the exercise helps lenders clean up their balance sheets and achieve taxation efficiency.
He said public sector banks have recovered Rs 36,551 crore of bad loans or NPAs during April-June quarter of the current financial year as compared to Rs 74,562 crore recoveries made in the full 2017-18 fiscal.
Commenting on reports that the country's 21 state-owned banks wrote-off Rs 3.16 lakh crore of loans in four years of the BJP government and made recoveries of Rs 44,900 crore of written off loans, Jaitley in a Facebook blog said "technical write-offs" are resorted to by banks as per the Reserve Bank of India (RBI) guidelines.
"This however does not lead to any loan waiver. Recovery of loans continues rigorously by banks," he said. "In fact the defaulting management of most insolvent companies have been removed under the Insolvency and Bankruptcy Code (IBC)."
Congress President Rahul Gandhi used the report to attack the government, saying demonetisation converted black money into white and Rs 3.16 lakh crore of loans were written off.
"Modi's India - For Common Man: Notebandi-line up and put your money in banks. All your details into Aadhar. You can't use your own money. For Crony capitalists: Notebandi-convert all your black money to white. Let's write off 3.16 lakh crore using common man's money," Gandhi said in a tweet.
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