IL&FS did not disclose NPAs for 4 years

New Delhi: The Reserve Bank of India (RBI) said in a report that IL&FS had not disclosed any non-performing assets (NPAs) for the last four years. The report is based on an inspection of the NBFC Infrastructure leasing and financial solutions and IFIN and this has been conveyed by the new board of the NBFC to the National Company Law Tribunal (NCLT).

'Various instances of lapses & mismanagement'

"Wide divergences were observed between the reported and assessed position of assets classification and provisions," the 5^th progress report of IL&FS said while quoting the RBI.

"Wide divergences were observed between the reported and assessed position of assets classification and provisions,"- Reserve Bank Of India

The report also highlighted various lapses and instances of mismanagement of the affairs of IL&FS and its group entities by the former board of the NBFC.

The backdrop

The audit panel of IL&FS appointed Grant and Thornton India LLP in January this year to do a special audit for all high-value transactions of the NBFC and group companies for the period between April-September 2013. This also included a special audit for IL&FS Financial Services. Earlier in April this year the Reserve Bank of India had made it mandatory for the banks to reflect defaults of IL&FS Group companies as non-performing assets in their accounts, the RBI had said in a submission to the National Company Law Appellate Tribunal (NCLT).