Relief to firms: Supreme Court halts IBC process under RBI mandate
The Supreme Court on Tuesday asked the Reserve Bank of India (RBI), banks and others to desist from invoking insolvency proceedings against corporate defaulters as per the banking regulator’s mandate till its orders, a move that would enable scores of stressed units in the power, textiles, sugar and shipping industries to avoid being immediately dragged by their lenders to the insolvency arena and look for alternative ways for resolution. The court will hear the matter next in mid-November.
Co-location case: Sebi directs senior NSE officials to stay ‘out of action’
Securities and Exchange Board of India (Sebi) has directed the NSE to keep four senior officials, served show-cause notices (SCN) in the co-location case, out of action. Sources said these four key managerial personnel (KMP) will have to remain out of the bourses “sensitive” and “confidential” matters until the probe is complete. The move is to ensure a fair trial in the colo case, which is nearing conclusion. “These KMP have also been directed to recuse themselves from key decisions of the NSE. Further, they have been told not to participate in any of the core activities,” said a regulatory official.
Doubling limit for filing DRT cases to expedite NPA recovery: Finance Ministry
The government has doubled the pecuniary limit to Rs 20 lakh for filing applications in the debt recovery tribunals (DRTs) to declutter them and help them focus on high-value matter. Financial services secretary Rajiv Kumar said the higher limit will free up DRTs, leading to quicker recovery from defaulters. The government amended the rules of Recovery of Debts due to Banks and Financial Institutions Act, 1993, last week and raised the limit from Rs 10 lakh earlier. This was part of the finance ministry’s move to make the debt recovery process more efficient.
Power NPAs: SC transfers all pleas challenging RBI notification to itself
In a temporary relief to stressed assets, the Supreme Court on Tuesday asked banks not to refer any case for insolvency under the February 12 circular of the Reserve Bank of India (RBI) for the next two months. The apex court also transferred to itself all cases challenging the notification. The next hearing has been fixed for November 14. Besides stressed power assets, shipping and sugar companies had also sought relief from the RBI notification. Among the petitioners were Punj Lloyd, the South Indian Sugar Mills Association-Tamil Nadu, Dharani Sugar & Chemicals, the Shipyards Association of India, and the All India Bank Officers’ Confederation.
NCLT admits insolvency case against West Bengal government undertaking
The Kolkata bench of the National Company Law Tribunal (NCLT) has admitted insolvency proceedings against West Bengal Mineral Development & Trading Corporation (WBMDTC), a government of West Bengal undertaking. WBMDTC, established by the state 45 years ago under special statute to secure and facilitate the growth of mining and mineral based industries and trading activities in Bengal, was referred to the bankruptcy court by Hiranmaye Energy, formerly known as India Power Corporation (Haldia), over unpaid dues.
IBBI working on group insolvency norms: M.S. Sahoo
Insolvency and Bankruptcy Board of India (IBBI) chairman M.S. Sahoo Tuesday said the process of putting in place the norms on group insolvency is underway. “The work has started on group insolvency norms, but I will not be able to give a timeline as to when it will be finalized,” Sahoo told reporters on the sidelines of a capital market conference organized by the industry lobby Ficci here. The IBBI is also working on a framework for cross- border insolvency cases. Sahoo said the government has already put out a paper on insolvency and a committee is examining the comments received on the draft paper.
SEA opposes NCDEX plan to extend trading hours
The Solvent Extractors’ Association of India (SEA) has strongly opposed the move by NCDEX to extend trading time and has written to the chairman of the Securities Exchange Board of India (Sebi) not to consider this proposal. “NCDEX has proposed to extend the trading time from the existing 10 am to 5 pm to 9 am to 7 pm in the guise of alignment between agri-futures and physical market practices. The business in the physical market like APMC’s takes place up to 5 pm and no physical trade take place after closing hours. Also, major auction takes place in the morning between 10 am to 12 noon and no trading activities takes place thereafter.
Govt plans special courts under NCLT by Nov to deal with insolvency cases
Special courts under the National Company Law Tribunal (NCLT) are likely to be set up by November to deal with an increasing number insolvency cases. The Ministry of Corporate Affairs is working on this proposal. Officials in the ministry said 30 judges might be recruited. “Our focus is to hire as many judges as possible because the tribunal cannot function without them. It can function with a few technical members or none, but not without judicial members,” said a senior official. Eight courts would be set up for this, three in Mumbai, two in New Delhi, and one each in Chennai, Kolkata, and Hyderabad.
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