To tackle increasing demand, the Union Ministry of Power has urged central and state public-sector power-generating companies (gencos) and state power and energy departments to pick projects that are undergoing insolvency proceedings. The power ministry is looking at a quicker turnaround of these stressed power plants and enhancing power supply. Increasing demand is pushing states to scout for more power sources. "It is requested that state-owned gencos may be encouraged to participate in the corporate insolvency resolution process (CIRP) of stressed power assets, which are of strategic and commercial significance to the capacity addition plans of the states concerned.
Insolvency professionals feel the bankruptcy code will deter defaulters, but NPAs will not cease unless banks are sensitised on credit appraisal and experts are hired by banks to inspect what is happening with their loans.
In insolvency proceedings, Ericsson will be treated as only an operational creditor and may end up losing the Rs 550 crore
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.
Byju's Founder Byju Raveendran's plea against the Insolvency of Think & Learn before the NCLAT was adjourned on Monday as one of the members of the bench recused from the hearing. The matter will be placed before a bench headed by National Company Law Appellate Tribunal (NCLAT) Chairman Justice Ashok Bhushan, who will assign a different bench to hear the matter. Raveendran had filed a petition challenging the initiation of insolvency proceedings against Think & Learn, which runs edtech company Byju's.
The Supreme Court's ruling in the BPSL case exposes deep flaws in the IBC's institutional framework and raises concern about judicial overreach, notes Rajeswari Sengupta.
The brand new bankruptcy process is being brazenly gamed by those with connections and money. The touts and fixers of the previous regime have been replaced by a new set close to this one, observes Debashis Basu.
In a major relief to Byju's, the NCLAT on Friday set aside insolvency proceedings against the troubled edtech major over a sponsorship deal and approved a Rs 158 crore settlement with the Board of Control for Cricket in India. The National Company Law Appellate Tribunal (NCLAT), however, passed the order with a caveat that any failure to make payments on the specific dates mentioned in the undertaking would automatically lead to a revival of the insolvency proceedings against Byju's.
The Resolution Professional (RP) of Future Retail Ltd (FRL) has filed an application before the NCLT against Kishore Biyani, his brother Rakesh Biyani and eight other entities alleging their involvement in a "fraudulent transaction" in the company. This application "has been filed pursuant to the findings in the report received from Nangia & Co. LLP, which was appointed as 'Transaction Review Auditor' by the RP," said a regulatory filing from Future Retail Ltd (FRL). The Transaction Review Auditor was to assist RP in his duties and the determination, wherein a transaction has been reported under Section 66 of the Code for adjudication by the NCLT.
Government officials were struggling to understand why the lenders denied emergency funds even after giving verbal assurances on providing Rs 1,200 crore.
As many as 48 companies, including Reliance Retail, Jindal Power Ltd and Adani group, are in the final list of eligible prospective resolution applicants for acquiring debt-ridden Future Retail Ltd. The Resolution Professional of Future Retail Ltd (FRL), which is currently going through an insolvency resolution process, on Monday came out with the final list of 'Eligible Prospective Resolution Applicants'. On April 10, FRL's RP updated a list of 49 companies, which had submitted Expressions of Interest (EoIs) after the company's lenders decided to invite fresh bids after dividing its assets into clusters.
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
With the amendment, firms like EY and Deloitte can work as resolution professionals instead of only their partners enrolling as insolvency professionals.
'A 180-days period -- for insolvency resolution -- is aggressive, but by no means inadequate.'
Experts say this further underlines the lack of investor interest in stressed assets at present.
The Insolvencies and Companies Court of London high court on Monday declared fugitive business baron Vijay Mallya a bankrupt person as per UK laws. Legal experts explain what this means for 65-year old Mallya's personal liberties, his legal battle against extradition to India to face trial, and for the consortium of Indian lenders - at whose behest the bankruptcy proceedings were initiated in the UK courts.
The Delhi high court on Monday sought the Centre and SBI's reply to former RCom chairman Anil Ambani's plea to include the Chinese banks, which have got a decree of $717 million against him from a court in United Kingdom, in the proceedings related to recovery of Rs 1200 crore loan granted to two of his companies. The high court also said that the moratorium on recoveries from sale of Ambani's assets, as provided under section 96 of the Insolvency and Bankruptcy Code (IBC), would remain in operation for now. This direction came on the application moved by the State Bank of India (SBI) seeking a declaration that the moratorium shall continue to be in effect.
Corporate Affairs Secretary Injeti Srinivas said the issue is how the interests of stakeholders are to be balanced
Last fortnight, State Bank of India Chairman C S Setty lifted the veil on a subject long spoken of in corporate corridors: Why can't our banks finance mergers and acquisitions (M&As)? Change is in the air: Indian Banks' Association (of which Setty is the chairman) is to "make a formal request" to Mint Road to make way for it. Thus far the exclusive turf of foreign banks even though its funding remains offshore - as in, it's not on these entities rupee-book (and a few select shadow banks) - a most lucrative segment in the investment banking suite, M&As, will be homeward-bound.
The new Insolvency and Bankruptcy Code has serious drawbacks, finds out Somasekhar Sundaresan.
Mint Road's proposals on banks' M&A funding are cautious even as entrants root for more elbow room, and weigh business models.
Grounded Go First's CEO Kaushik Khona has put in his papers, nearly seven months after the no-frills airline filed for insolvency proceedings. In an e mail to the airline's employees on Thursday, Khona said that November 30 is his last day at the company. Khona had returned to Go First in August 2020 as its CEO.
The government is drawing up a relief package for industry with steps such as relaxation of asset-classification norms by banks, thus allowing companies to delay the repayment of loans, and tax holidays for the worst-hit sectors like aviation and hospitality. But it might not be enough to stop more bankruptcies from getting filed.
Seeking to provide a quicker and value-maximising outcome for stressed MSMEs, the government has introduced a pre-packaged resolution process for such enterprises by amending the insolvency law. Now, Micro, Small and Medium Enterprises (MSMEs) can seek resolution for their stress through the pre-packaged process under the Insolvency and Bankruptcy Code (IBC). An ordinance was promulgated to amend the IBC on April 4. Many MSMEs have been impacted by the coronavirus pandemic and experts opined that the latest amendment, which comes less than two weeks after the suspension of certain IBC provisions ended, is a welcome move.
Byju's first came on board with the BCCI back in 2019 when mobile manufacturer Oppo transferred the sponsorship rights to the online tutorial firm.
The National Company Law Tribunal (NCLT) on Thursday reserved its order on crisis-hit airline Go First's plea seeking voluntary insolvency resolution proceedings and interim moratorium on financial obligations while aircraft lessors vehemently opposed the petition. Amid the airline facing severe financial crunch and cancelling flights, a two-member NCLT bench comprising Justice Ramalingam Sudhakar and Member L N Gupta heard the arguments for and against the petition for nearly four hours. As aircraft lessors opposed the plea, the counsels for Go First said the petition was not a malicious one to avoid payment of dues to its creditors but to save the company.
The government is contemplating changes to the Insolvency and Bankruptcy Code (IBC) to deal with environmental claims and liabilities of defaulting companies to make the law future-ready and meet climate action goals, sources told Business Standard. Currently, the IBC has various categories of claims and creditors, including those related to environmental liabilities.
In a significant development, the Supreme Court on Thursday recalled its controversial May 2 verdict that had ordered liquidation of Bhushan Power & Steel Limited (BPSL) while setting aside a resolution plan of JSW Steel Limited for the ailing firm. A bench comprising Chief Justice B R Gavai and Justice Satish Chandra Sharma observed that the May 2 judgment, authored by Justice Bela M Trivedi, since retired, did not "correctly consider the legal position as has been laid down in the catena of judgments".
Some experts says that the high net-worth requirement of Rs 50 crore for setting up an IU is a deterrent.
Day 6 of Parliament's monsoon session 2020. Watch all the action in both houses LIVE here.
No-frills carrier Go First filing for insolvency proceedings and cancelling flights is bad for the airline industry as the move will reduce capacity and could push airfares in certain routes, travel agents' grouping TAAI said on Wednesday.
The Centre has also listed 24 bills, including the Cantonment Bill, the Multi-State Cooperative Societies (Amendment) Bill and the Insolvency and Bankruptcy Code (Amendment) Bill.
The government is planning to draft rules for the National Company Law Tribunal (NCLT) to deal with Insolvency and Bankruptcy (IBC) cases, according to official sources. The Ministry of Corporate Affairs (MCA) is also looking to fill all vacant posts at various NCLT Benches by August and put in place an IT-enabled system that would use artificial intelligence (AI) for case management. The NCLT, adjudicating authority for matters related to company affairs, was constituted before the IBC came into effect.
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.
You have to grow, and grow fast - that's the DNA of the JSW group, chairman Sajjan Jindal said as JSW Cement made its debut on the stock market mid-August. The remark captured not just the moment but also the momentum of JSW's growth story.
Around Rs 1 trillion, or a fifth of the investments made by alternative investment funds (AIFs) are questionable in terms of the intent behind the investments and are under the scanner for circumvention of regulations, said Ananth Narayan, whole-time member of Securities and Exchange Board of India (Sebi). AIFs are pooled investment vehicles that invest in a variety of assets including real estate, startups, unlisted companies, and derivative strategies in the listed space.
In what could result in a complete overhaul of the Insolvency and Bankruptcy Code (IBC), the insolvency regulator has sought public comments on the regulations it notified under the code to date. The Insolvency and Bankruptcy Board of India (IBBI) has given a window of eight months ending December 31 to all stakeholders to share their views on its regulations. IBBI has called the exercise "crowdsourcing of ideas".
Wadia group-owned Go First will temporarily suspend flights on May 3 and 4 amid severe fund crunch, the airline's chief Kaushik Khona said on Tuesday.
In a significant verdict, the Supreme Court on Wednesday set aside the National Company Law Appellate Tribunal's (NCLAT) verdict that had stopped insolvency proceedings against embattled ed-tech firm Byju's. A bench of Chief Justice D Y Chandrachud, and Justices J B Pardiwala and Manoj Misra also reversed the order of the NCLAT approving Byju's Rs 158.9 crore dues settlement with the Board of Control for Cricket in India (BCCI) and directed the cricket board to deposit the settlement amount of Rs 158.9 crore with a committee of creditors.
