Chandigarh State Commission holds debenture Trustee & Credit agencies liable in DHFL debenture default

The State Consumer Disputes Redressal Commission, Chandigarh, held Catalyst Trusteeship Ltd. and Credit Rating Agencies Credit Analysis & Research Ltd. and Brick Works Ratings India Pvt. Ltd. liable for failing to safeguard investor interests in DHFL’s default on secured debentures.

The bench found that the trustee failed to enforce securities and maintain statutory reserves, while rating agencies misled investors by continuing 'AAA' ratings despite DHFL’s financial crisis.

The Commission directed a payment of Rs. 2,04,880/- with 9% interest, Rs. 2,00,000/- as compensation, and Rs. 33,000/- for litigation costs to be paid jointly.

[Jyoti Khemka v Catalyst Trusteeship Ltd. & Ors]