The government has come down heavily on Infrastructure Leasing & Financial Services’ (IL&FS’) former management, led by Ravi Parthasarathy, who retired in July 2018, vice-chairman Hari Sankaran, former managing director of IL&FS Financial Services Ramesh Bawa, and director K Ramchand, by issuing a lookout notice for them at the airports.
In its petition filed with the National Company Law Tribunal, the government said these directors were likely to flee the country overnight, and therefore the government had issued a lookout notice for these individuals.
While Parthasarathy is in London undergoing treatment, the other directors will not be able to leave the country till the investigation is over.
By being either members of the board of directors, promoters, auditors, etc, the directors are privy to the inner workings of their respective businesses, the government said, adding they cannot evade responsibility for the business activities, misfeasance, persistent negligence, and continuous defaults in carrying out their duties.
Further, as a result of this misleading intent of such a huge magnitude, the stock market would be adversely affected, the government said. This will have a cascading impact not only on IL&FS but on business sentiment in particular, the economy at large and on a large section of common investors and creditors. Siphoning off funds has been systematically carried out by way of excessive withdrawal of remuneration by the directors, which are apparent from the company’s filings.
“Further, the mischievous intent has been so apparent that many of the directors realised the IL&FS along with its group companies has become a Titanic, and thus resigned their directorship,” the petition said.
Parthasarathy resigned in July, while Bawa, non-executive director Vibhav Kapoor, and four independent directors of IL&FS Financial Services resigned after a default last month.