IL&FS has approached the Mumbai Bench of the National Company Law Tribunal (NCLT) to recover ₹185.88 crore in excess managerial remuneration paid to 23 former directors of the group and two key subsidiaries after financial statements for five years were recast.
The application seeks directions to former directors of Infrastructure Leasing & Financial Services (IL&FS), IL&FS Financial Services (IFIN) and IL&FS Transportation Networks (ITNL) to return the money. The company has also sought an interim order requiring the identified former directors to deposit the alleged excess remuneration or undue gains in a separate interest-bearing fixed deposit account while the proceedings are pending.
IL&FS said remuneration had been paid on the basis of profits reported in the original accounts. After the accounts were recast following directions from the NCLT, those years showed substantial losses instead of profits. The recast accounts for IL&FS showed a cumulative loss of ₹9,415.24 crore between financial years 2013-14 and 2017-18, compared with a reported profit of ₹1,865.73 crore in the original accounts.
The corresponding recast figures showed IFIN with a loss of ₹5,655.22 crore against an earlier reported profit of ₹1,015.67 crore. ITNL recorded a loss of ₹1,628.44 crore against a reported profit of ₹1,246.33 crore.
The Ministry of Corporate Affairs directed IL&FS to recover the excess remuneration, after which notices were issued to all 23 former directors. IL&FS said the former directors raised objections and that no refund had been made by any of the former managerial personnel despite multiple notices and reminders.
According to the application, three former non-executive directors—two from IL&FS and one from ITNL—have made refunds. Against a total refundable amount of ₹187.02 crore, only ₹91.09 lakh, net of ₹22.78 lakh paid as income tax, had been returned. IL&FS described this as less than 0.5 per cent of the amount.
The recovery proceedings name several former independent directors, including R C Bhargava, Jaithirth Rao, Michael Pinto, S B Mathur and Rina Kamath of IL&FS; Subhalakshmi Panse, Surinder Singh Kohli and Neera Saggi of IFIN; and Deepak Dasgupta and Pradeep Puri of ITNL. Former executive directors named include Hari Sankaran, Arun Kumar Saha, Ramesh Bawa and K Ramchand. In the case of former IL&FS chairman Ravi Parthasarathy, who has died, the recovery claim has been initiated against his legal heir.
IL&FS said it was pursuing recovery from managing directors, whole-time directors, managers and CEOs under Section 199 of the Companies Act. It also cited Section 197(9), which requires any director, including non-executive and independent directors, to refund sums drawn beyond prescribed limits.
The former directors have disputed the notices on grounds including that the recast financial statements cannot retrospectively invalidate remuneration approved on the basis of duly audited original accounts. They have also argued that the recast accounts are not audited statements and that the notices were vague because the amounts differed between earlier and later notices. IL&FS called the objections baseless and said the discrepancy resulted from a calculation variation that had been corrected.
The application adds a recovery dispute to the wider resolution of the infrastructure financier’s debt crisis. As of October 2018, the IL&FS group had fund-based debt of ₹94,215 crore out of total external debt of ₹99,355 crore. Around ₹48,000 crore, or nearly 51 per cent, was availed by four key holding companies: IL&FS, IFIN, ITNL and IEDCL.
The group said it was resolving debt through monetisation and the termination or settlement of payments by its entities from concessioning authorities and counterparties. It has maintained an overall debt-resolution target of ₹61,000 crore, while the new board had executed steps to resolve about ₹50,387 crore of group debt as of June 30, 2026.
The NCLT had superseded IL&FS’s existing board on October 1, 2018, following the crisis that shook the finance industry. The tribunal and the National Company Law Appellate Tribunal subsequently supported a resolution framework for the group and granted protections to IL&FS companies and newly appointed directors against certain recovery actions and proceedings linked to the earlier management. The latest application will now be considered by the Mumbai Bench.
