Sun Jul 06 17:56:02 UTC 2025: **News Article:**

**NCLT Refers NTADCL and IL&FS Debt Dispute to Civil Court**

**CHENNAI – July 6, 2025** – The National Company Law Tribunal (NCLT) in Mumbai has dismissed petitions from both New Tirupur Area Development Corporation Limited (NTADCL) and Infrastructure Leasing & Financial Services Ltd. (IL&FS) regarding a dispute over debt repayment, advising them to seek resolution through appropriate legal channels.

The disagreement stems from a 1995 project where NTADCL was established to enhance water and sewerage infrastructure in Tiruppur, Tamil Nadu. The project, valued at ₹1,023 crore, was financed through a combination of loans, including a ₹180 crore senior loan from IL&FS, which in turn raised ₹90 crore from USAID.

NTADCL alleges it has already overpaid IL&FS by ₹249.92 crore, accusing the company of fraudulent loan disbursement. IL&FS, on the other hand, claims NTADCL has unilaterally stopped repayments since December 2022, with an outstanding principal amount of ₹52.92 crore.

NCLT stated that NTADCL’s allegations warrant investigation and that the company could approach the Serious Fraud Investigation Office (SFIO). It also noted that IL&FS’s demands constitute recovery proceedings that fall under the jurisdiction of Civil Courts.

An IL&FS spokesperson stated that it would pursue recovery in civil court, in accordance with NCLT direction.

NTADCL maintains its stance that the transaction was fraudulent, citing legal opinions supporting its decision to halt payments to IL&FS. It emphasizes the Tamil Nadu government’s investment in the project’s revival and its obligation to protect its interests.

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