An additional obstacle has emerged in the ₹9,861-crore acquisition of Anil Ambani’s Reliance Capital by Hinduja-owned IndusInd International Holdings (IIHL). The Mauritius-based company says that the final payment to creditors will need to be adjusted for more than ₹1,000 crore in Goods and Services Tax (GST) dues that Reliance Capital’s insurance companies owe to the tax department.
According to news reports, the tax obligations may rise in light of the potential fines levied on the insurance companies for failure to pay premiums, which has both sides cautious of reaching a settlement.
Although the creditors are hesitant, IIHL requested last month in a letter that these earlier tax notices be adjusted. The NCLT may need to make a decision on this difficult matter in light of the impasse.
This has been a smoldering topic for the past two weeks. IIHL informed the Committee of Creditors (CoC) in writing last month that they were unable to pay the outstanding taxes. It goes without saying that CoC does not wish to lose so much to this demand. The impasse has persisted despite talks between the parties, according to the reports.
The matter has been discussed numerous times in meetings between CoC and IIHL, but neither party is willing to budge. Since the CoC approved the acquisition in June of last year, this has now become a point of dispute to close the sale.
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