A series of financial irregularities and governance violations have come to light at Exclusive Capital Limited (ECL), a non-banking financial company (NBFC), leading to multiple investigations and regulatory interventions. The National Company Law Tribunal (NCLT) Delhi has ordered an investigation under Section 242 of the Companies Act, 2013, while the Reserve Bank of India (RBI) has identified serious breaches of financial regulations.
Exclusive Capital’s Role in Hindustan National Glass CIRP
Exclusive Capital is also a Committee of Creditors (CoC) member in the Corporate Insolvency Resolution Process (CIRP) of Hindustan National Glass (HNG). In a landmark judgment on January 29, 2025, the Supreme Court set aside the resolution plan of AGI Greenpac, stating that the plan was not legally tenable. Further, in paragraph 155 of the judgment, the Supreme Court directed the CoC to consider INSCO’s resolution plan or any other resolution plan that had valid Competition Commission of India (CCI) approval as of October 28, 2022.
The CoC, exercising its commercial wisdom, approved INSCO’s resolution plan and subsequently issued a Letter of Intent (LOI) to INSCO. Following this, the resolution plan of INSCO was filed with NCLT Kolkata for final approval.
However, in a surprising move, Exclusive Capital, a minority CoC member, challenged the majority CoC’s decision by filing an Interlocutory Application (IA) before NCLT Kolkata. The IA opposed the CoC’s decision to approve INSCO’s resolution plan and declare INSCO as the successful resolution applicant.
OpIndia has obtained a letter from the workers’ union of HNG addressed to the Court-appointed Observer/Administrator, Justice (Retd.) R.K. Gauba, raising concerns over Exclusive Capital’s actions. The letter alleges that Exclusive Capital’s conduct is aimed at derailing the resolution process of HNG and that it may be acting in the interests of AGI Greenpac, the Supreme Court-rejected resolution applicant. The workers’ union has urged Justice Gauba to intervene and examine whether Exclusive Capital, already under financial scrutiny, has been filing frivolous legal challenges at the behest of vested interests.
OpIndia’s Investigation and Justice Gauba’s Response
OpIndia has been tracking the insolvency proceedings of HNG for long and, therefore it preferred to send a list of questions to Justice R.K. Gauba. The reply is quoted below:
Dear Mr. Bagla / Mr. Jindal / Mr.Abraham,
I am in receipt of the email forwarded herewith, sent at my personal email ID, which seems to be already marked to Mr. Bagla and one another in Exclusive Capital Limited (ECL). A large number of facts mentioned in this communication are not part of the disclosures made to me by ECL and so are taken as inputs. Please share the entire information on the subject. You are also reminded that ECL is expected to disclose to the undersigned the facts and status of all litigation in which it is involved.
From the reply of Justice Gauba, it seems that he is not aware of any such IAs being filed by Achal Jindal on behalf of Exclusive Capital (CoC member of HNGIL). Such major revelations directly question the legitimacy and intentions of Exclusive Capital and under whose approval or authority such frivolous IAs have been preferred to be filed by the top management of the board, which itself is under massive financial misappropriation investigation by various agencies. In light of these findings, NCLT and NCLAT have appointed an Observer on the board to oversee the operations of Exclusive Capital.
Workers Union’s writ petition against IBBI, CoC, and RP
On March 12, 2025, the workers union of HNG filed a writ petition against IBBI, CoC, and RP, seeking clarification from IBBI regarding whether the Resolution Professional (RP) of HNG, whose Authorization for Assignment (AFA) is suspended, can continue to discharge his duties in the ongoing CIRP of Hindustan National Glass.
In a shocking turn of events, Supreme Court-rejected resolution applicant AGI Greenpac and CoC member Exclusive Capital attempted to intervene in the proceedings at the Delhi High Court, opposing the clarification issued by IBBI. Such conduct raises serious questions about Exclusive Capital’s role in derailing the resolution process of HNG to favour vested interests.
During the Delhi High Court hearing on March 12, 2025, IBBI’s counsel clarified and submitted to the court, which was recorded in paragraphs 3 and 4 of the court’s order:
“According to the petitioner, the same only precludes the RP from undertaking any new assignment. In this regard, reliance has been placed by the petitioner on the Division Bench judgment of the Bombay High Court in the case of Kairav Anil Trivedi vs. IBBI & Ors., 2024 SCC Online Bom 2572, particularly on paragraph 14 thereof.
When the matter came up for hearing yesterday, learned counsel for the IBBI sought time to take instructions. Today, it is submitted by learned counsel for the IBBI that in line with the judgment of the Bombay High Court, the order dated 30.01.2025 precludes the concerned RP from undertaking any new assignment/s; the same does not prevent him from continuing with any existing assignment/s. The said statement is taken on record.”
This statement by IBBI further discredits Exclusive Capital’s attempt to intervene in the proceedings and raises concerns over their intentions in opposing the clarification issued by IBBI.
Other ongoing investigations against Exclusive Capital:`
Exclusive Capital, formerly known as UT Leasing Limited, has been accused of siphoning funds, mismanagement, and regulatory non-compliance. The company, under the directorship of Satya Prakash Bagla has allegedly engaged in unauthorized financial activities, leading to legal scrutiny. Some of the major violations include:
Unapproved Issuance and Conversion of Debentures:
The company issued Optionally Convertible Debentures (OCDs) worth ₹315 crores between October 2021 and March 2022 without RBI’s prior approval. These were later converted into Compulsorily Convertible Preference Shares (CCPS), violating RBI regulations.
Breach of Leverage Ratio:
RBI guidelines prescribe a maximum leverage ratio of 7 for base-layer NBFCs. However, ECL had an astonishing leverage ratio of 117.77 as of March 2022. This indicates that the company took on a disproportionate amount of debt, posing significant risks to its financial stability and investor interests.
Failure to Submit Financial Documents:
ECL has not provided its balance sheet, profit & loss statements, and auditor reports for multiple financial years, raising concerns over financial misrepresentation.
Allegations of Siphoning Funds:
Investigations have uncovered potential financial misconduct and misappropriation of funds. There are accusations of funds being transferred to related parties, allegedly for personal gain.
Criminal Investigations Against Management:
Satya Prakash Bagla and other directors are reportedly under investigation by multiple law enforcement agencies, including the Central Bureau of Investigation (CBI), Enforcement Directorate (ED), Directorate of Revenue Intelligence (DRI), and Economic Offenses Wing (EOW).
Conclusion
To conclude, it looks like major material facts regarding Hindustan National Glass are being suppressed by the management of Exclusive Capital from Court-appointed Observer Justice R.K. Gauba. It further appears that the actions of Exclusive Capital’s directors—who themselves are under investigation—are solely aimed at derailing HNG’s CIRP. This raises serious concerns about the legitimacy and true intentions of Exclusive Capital in this entire insolvency process.
The ongoing investigations into Exclusive Capital and Satya Prakash Bagla expose a deep-rooted pattern of financial violations and corporate mismanagement. With multiple agencies, including RBI, NCLT, CBI, and ED, now involved, the case is expected to have far-reaching legal and financial implications.
