The insolvency and bankruptcy process in India

India Infoline News Service | Mumbai | June 18, 2017 12:52 IST

In a bid to crack down on defaulters, an independent advisory committee commissioned by the Reserve Bank of India (RBI) has decided to refer 12 companies, who have been identified as the top defaulters, to the insolvency and bankruptcy proceedings. These 12 companies account for over 25% of the gross non-performing assets that is present in the Indian banking system.

In a bid to crack down on defaulters, an independent advisory committee commissioned by the Reserve Bank of India (RBI) has decided to refer 12 companies, who have been identified as the top defaulters, to the insolvency and bankruptcy proceedings. These 12 companies account for over 25% of the gross non-performing assets that is present in the Indian banking system.


However, the names of these companies, who are expected to be large business houses, have not been revealed till now. The RBI is expected to give out directives to the banks regarding the 12 companies or NPA accounts to begin the proceedings.


The Insolvency and Bankruptcy Code introduced in 2016, sanctions the “reorganisation and insolvency resolution of corporate persons, partnership firms and individuals” and has specific provisions for the insolvency procedure, which may even lead to resolution or liquidation. While, on receiving the names of these 12 defaulters, the lead bank in the joint lender forums (JLFs) will further forward the case to the National Companies Law Tribunal (NCLT). 

Disclaimer: The contents herein is specifically prepared by ‘Dalal Street Investment Journal’, and is for your information & personal consumption only. India Infoline Limited or Dalal Street Investment Journal do not guarantee the accuracy, correctness, completeness or reliability of information contained herein and shall not be held responsible.

 

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