Grant Thornton to be transaction auditor for DHFL resolution

Dewan Housing Finance Corporation Ltd (DHFL) on Monday said that its administrator R. Subramaniakumar has appointed Grant Thornton India LLP as the transaction auditor for the corporate insolvency resolution process (CIRP).

In a regulatory filing, DHFL said that the transaction auditor would ascertain if the the company had entered into preferential transactions, undervalued transactions, or carried out transactions defrauding creditors, among others, under the the Insolvency and Bankruptcy Code (IBC).

"The transaction auditor under the scope of work is also required to identify and review irregular borrower accounts from the angle of possible fraud and specifically review the underlying documents and security made available and its enforceability, " it said.

The administrator would determine on or before the 115th day of the insolvency commencement date, December 3, 2019, if the corporate debtor has been subjected to any of the inappropriate transactions and would accordingly apply to the NCLT for appropriate relief per Regulation 35A(3) on or before the 135th day of the insolvency commencement date, it added.

In December, the Mumbai bench of of the National Company Law Tribunal (NCLT) admitted the RBI's application for the initiation of insolvency proceedings against the cash-strapped DHFL.

The apex bank filed the application for initiation of corporate insolvency resolution process against DHFL under several clauses of Section 227 and Section 239 of the Insolvency and Bankruptcy Code, 2016 along with provisions under the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers) Rules.

The RBI appointed a committee to advise the administrator of the private sector lender after superseding the company's board of directors and appointing Subramaniakumar as its administrator on November 20.