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NCLT allows Indiana Hospital's plea to extend tenure for redeeming cumulative pref shares by 2 yrs

Bar & Bench  

The National Company Law Tribunal (NCLT), Bangalore has allowed a petition to extend the tenure of Indiana Hospital and Heart Institute Ltd's 5% redeemable cumulative preference shares by two years given the company's inability to mobilise funds to redeem the same on account of the Covid-19 pandemic and the resulting economic slowdown. The order was passed after the firm, engaged in the business of owning, maintaining and managing hospitals, moved the plea in line with certain statutory requirements. The company claimed that owing to the onset of the pandemic, it was not able to raise the funds required to redeem the shares due on October 2020 from the company profits and the proceeds from the fresh issue of shares. This forced the management to take steps to extend the tenure to redeem existing preference shares by two years.