The National Company Law Tribunal (NCLT) on Wednesday admitted Go First's voluntary plea to initiate the insolvency resolution process against the airline. A two-member bench comprising President Justice Ramalingam Sudhakar and L N Gupta also appointed Abhliash Lal as interim resolution professional (IRP) to run the debt-ridden company. It has also put the company under protection of moratorium and directed the suspended board of directors to assist the IRP to run the company during insolvency proceedings.
The RBI on Thursday filed an application for initiation of Corporate Insolvency Resolution Process (CIRP) against debt-ridden Reliance Capital at the Mumbai bench of the National Company Law Tribunal. The Reserve Bank had on November 29 superseded the board of Anil Ambani-promoted Reliance Capital Ltd (RCL) in view of payment defaults and serious governance issues. The central bank had also appointed Nageswar Rao Y (former executive director, Bank of Maharashtra) as the administrator of the company.
The government has recapitalised public sector banks (PSBs) by infusing over Rs 3.10 lakh crore in the last five fiscals, a majority of which was through issuance of recapitalisation bonds, Parliament was informed on Monday. "Government has infused Rs 3,10,997 crore to recapitalise banks during the last five financial years i.e., from 2016-17 to 2020-21, out of which Rs 34,997 crore were sourced through budgetary allocation and Rs 2,76,000 crore through issuance of recapitalisation bonds to these banks," Minister of State for Finance Bhagwat Karad said in a written reply in the Lok Sabha. He was responding to a host of questions asked by Congress party's Member of Parliament Manish Tewari.
Jet Airways' cabin crew and ground staff have challenged the Jalan Kalrock consortium's resolution plan, which was approved by the National Company Law Tribunal (NCLT) in June, flagging concerns about pending salaries and retirement benefits. In their petition filed before the National Company Law Appellate Tribunal (NCLAT), the Jet Airways Cabin Crew Association and Bhartiya Kamgar Sena have submitted that dues of all workmen of the airline were not included as part of the Corporate Insolvency Resolution Process (CIRP) cost. In June, NCLT approved Jalan Kalrock Consortium's resolution plan for Jet Airways, which remains grounded for more than two years now.
Experts say this further underlines the lack of investor interest in stressed assets at present.
Real estate developer Supertech on Friday was declared bankrupt by the National Company Law Tribunal (NCLT), a move that could have a bearing on 25,000 home buyers of the firm's ongoing projects in the Delhi and NCR region. Acting on a petition filed by the Union Bank of India for non-payment of around Rs 432 crore worth dues, the bankruptcy court ordered the initiation of insolvency proceedings against real estate firm Supertech Ltd, one of the companies of Supertech group. The NCLT said "there has been a default in payment of the financial debt" and appointed Hitesh Goyal as the Interim Resolution Professional (IRP) superseding the board of Supertech Ltd.
As many as 49 players including Reliance Retail, Jindal Power Ltd and Adani group have submitted Expression of Interest (EoI) for acquiring the assets of debt-ridden Future Retail, which is currently going through insolvency resolution process. Reliance Retail Ventures Ltd, which is the holding company for retail operations of RIL and April Moon Retail Private Ltd, a joint venture between Adani Airport holdings and Flemingo group have again submitted their EOI, after the lenders of Future Retail decided to invite fresh bids after dividing FRL's assets into clusters. According to an update from FRL's Resolution Professional, the 49 players would be permitted to submit "resolution plan(s) for any/all such Clusters under Option II".
This is an exceptional case of extension beyond the 330-day limit under the insolvency and bankruptcy code.
A draft proposal by the sub-committee of the insolvency law committee has recommended that the corporate debtor (CD) may initiate the prepack since it may prove difficult to implement if creditors are allowed to do so without the willingness of the promoter.
The total admitted claim of financial creditors of these 88 companies stood at Rs 1.3 trillion, of which they recovered Rs 65,635 crore.
Around 241 companies were sent for liquidation under the IBC by various NCLT benches and in only 58 cases have the resolution plans been accepted
The settlement offer has been made for 13 out of the 15 Videocon group companies that are currently under Corporate Insolvency Resolution Process.
Resignations of Anil Ambani and four other directors were conveyed to the CoC of RCom in its meeting on November 20 and were unanimously rejected.
In a move to plug gaps in the Insolvency and Bankruptcy Code (IBC), the ministry of corporate affairs (MCA) has proposed robust norms against avoidance transactions, wrongful trading, and inordinate delays via changes to look-back period and fixed timelines for the tribunals to reject or approve plans, among other measures. The MCA has proposed that the IBC should provide the adjudicating authority with 30 days for approving or rejecting a resolution plan under Section 31. If a decision is not made on the resolution plan within that period, the adjudicating authority will record reasons in writing for the same, the ministry has proposed.
Bankers say debt resolution bills are coming high as resolution professionals are giving the human resources and audit/legal consulting to outside firms to plug all the loopholes.
The closure of BPSL would add about three million tonnes capacity to JSW Steel's existing 18 million tonnes.
The National Company Law Tribunal (NCLT) has approved the resolution plan of Twin Star Technologies -- a promoter entity of the Vedanta Resources group -- for the Videocon group. But it has pointed out that the successful resolution applicant is "paying almost nothing" as the amount offered is only 4.15 per cent of total outstanding claim. It noted the hair cut for all the creditors is 95.85 per cent and suggested to both committee of creditors (CoC) and the successful applicant an increase in the payout.
The National Company Law Appellate Tribunal (NCLAT) on Monday dismissed the petition filed by an employee association of debt-ridden Jet Airways, challenging the sale of two floors of office space in Mumbai's business district of Bandra Kurla during the insolvency process of the grounded carrier. Jet Aircraft Maintenance Engineers Welfare Association (JAMEWA had challenged the orders passed by the Mumbai bench of the National Company Law Tribunal (NCLT) on June 11, 2021, allowing the sale of the office space for Rs 490 crore. The association had contended that the sale of BKC property, was not permissible under the Insolvency & Bankruptcy Code (IBC) as a moratorium was declared over the assets of the company after an order dated June 20, 2019.
With just a few days left for the suspension on fresh corporate insolvency cases to end, government sources have indicated that another extension is unlikely. An extension may not be economically desirable as it hampers the restructuring prospects for stressed companies, according to senior officials. Also, it would be a challenge to amend the law in such a short time. A Bill would have to be passed in both Houses of Parliament, if any change, with respect to suspension of Insolvency and Bankruptcy Code (IBC), is to be made - including extension or creating any exceptions to the rule.
The Reserve Bank had identified 12 accounts, each having more than Rs 5,000 crore of outstanding loans accounting for 25 per cent of total NPAs or bad loans of banks, for immediate referral for resolution under the bankruptcy law.
Public sector lender Punjab National Bank (PNB) has moved the Insolvency appellate tribunal NCLAT against the approval of bids for defunct airline Jet Airways. The National Company Law Appellate Tribunal (NCLAT) bench has issued a notice over the PNB's petition along with its interim plea seeking a stay over the execution of the resolution plan. A three-member bench has directed the Resolution Professional of Jet Airways along with other parties including the Committee of Creditors to file a reply within two weeks and rejoinder, if by PNB, within one week.
Public sector lender Bank of India has moved to the National Company Law Tribunal (NCLT) seeking initiation of insolvency proceedings against Future Retail Ltd and a moratorium over the assets of the Kishore Biyani-led debt-ridden firm. Besides, Bank of India (BOI), the lead banker of a consortium of banks that lent money to Future Retail Ltd (FRL), also suggested the insolvency tribunal appoint Vijay Kumar V Iyer as the interim professional of the company. Meanwhile FRL, in a regulatory filing, said it has been served and received a copy of the petition and is in the "process of taking legal advice".
Experts say that under the liquidation process, financial and operational creditors are less likely to recover the full-value of their dues, while employees may not get their full salaries.
Bankruptcy court NCLT on Tuesday allowed billionaire Anil Agarwal's Twin Star Technologies to take over Videocon Industries Ltd for about Rs 3,000 crore. Twin Star, a part of Vedanta Group, will pay around Rs 500 crore within 90 days as upfront payment and the rest as non-convertible debentures over a period of time. A two-member Mumbai bench of the NCLT comprising members - H P Chaturvedi and Ravikumar Duraisamy - approved the resolution plan by Twin-Star Technologies.
Lenders to Venugopal Dhoot-founded Videocon Group will eventually take 50-55 per cent haircut and not 95 per cent as is being reported after considering about Rs 15,000 crore expected from the sale of the group's overseas oil and gas assets, its former CFO Rajneesh Gupta claimed. Videocon Industries Ltd, which is comprised of its consumer electronics business and interest in the Ravva oil and gas field, and its overseas oil and gas assets, mainly comprising of oil blocks in Brazil, are being auctioned separately to recover unpaid loans. While Anil Agarwal-led Vedanta Group has picked up Videocon Industries for Rs 2,962 crore, the bids for overseas assets are yet to be decided.
Jalan Kalrock Consortium, the winning bidder for the grounded Jet Airways, will make a total cash infusion of Rs 1,375 crore in the airline and lenders will take a steep haircut on their admitted claims of over Rs 7,800 crore under the approved resolution plan. The National Company Law Tribunal (NCLT) on June 22, approved the consortium's resolution plan for Jet Airways, which has been undergoing insolvency resolution process since June 2019. The carrier shuttered operations in April 2019.
Ruchi Soya was admitted to the corporate insolvency resolution process (CIRP) in December 2017 and owes lenders Rs 12,000 crore.
It is fundamentally against the interest of 800 million mobile users and over 100 million internet users in India.
Property buyers fund the project cost and the entire debt and entire equity servicing, and yet, have no locus standi in the IBC process, points out Debashis Basu.
Anil Ambani had given a personal guarantee to the loans given by SBI to Reliance Communications and Reliance Infratel in August 2016.
The company said that intense competition following the disruptive entry of a new player, legal and regulatory challenges, high level of unsustainable debt and increased losses had together caused significant "negative business and reputational impact".
Home buyers would be able to invoke Section 7 of the IBC against errant developers.
Adani Wilmar's bid was approved by the committee of creditors of the bankruptcy-bound Ruchi Soya with about 96% votes in favour
Jet Airways HQ owner wants resolution professional to vacate premises. The licence for occupying the place has been terminated, on account of the airline having not paid the rent after March.
As NCLAT chair, lack of basic infrastructure remains Justice Mukhopadhaya's biggest challenge. The lack of permanent staff to take down orders in shorthand and later type them out for him to correct is just one among many. In cases where there are a number of intervening parties and applicants, the courtroom is often so jam-packed that even the senior advocates have failed to find place inside.
With assets depreciating over time, it will lead to large haircuts for lenders and creditors, say experts
While passing the scrutiny of courts is a tough challenge, with eight proposed amendments to the insolvency law, the government has sought to turn the focus back on at least some of the functions of the bankruptcy law.
A glance back at some important events that occurred in 2018.
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