IBC Financial News

₹2 lakh crore reflecting also the aggressive efforts mounted by them in the recovery of loans. It is also true that the IBC has helped over time given the recognition by many borrowers of the weakening of their terms of negotiation compared to the past.

ministry of corporate affairs (MCA) is seeking faster clearances of merger and acquisition (M&A) deals besides expeditious disposal of insolvency cases by the National Company Law Tribunal (NCLT), as it has substantially bolstered the member strength of the adjudicating authority by filling up most vacancies, a senior official said. «As many as 34 members have been added to the NCLT in less than a year now, taking the total strength to 57 (including its president), much closer to the sanctioned strength of 63. The next process (to appoint a few more) is also on,» the official said.

Bombay High Court against the forensic audit process of the company. Earlier in August this year, Kishore Biyani and his brother Rakesh Biyani were asked by Bank of India to respond to findings made in the forensic audit report by BDO, a forensic auditor appointed by the leading financial creditor of Future Retail Ltd (FRL). The forensic auditor had submitted its report on August 9, 2023, and Bank of India sought representation/submissions from the company over the credit facilities availed by Biyani, which was replied by the resolution professional on August 28, 2023, FRL said in a regulatory filing. «Kishore Biyani — Director of the Company, has filed a writ petition before High Court, Bombay, inter alia challenging the Forensic Audit process, including the Forensic Audit Report dated August 09, 2023, submitted to BOI by BDO India,» FRL said. Bank of India is the lead creditor of FRL, and CIRP was initiated against the retailer on its plea. The deadline to complete the CIRP of FRL was September 15.

To make surety bond business more attractive, the government is looking at making relevant changes in the Insolvency and Bankruptcy Code (IBC) to consider insurers as financial creditor in case of default of infra projects.The surety bond issued by a general insurance company is a three-party contract by which one party (the surety) guarantees the performance or obligations of a second party (the principal) to a third party (the obligee).The surety is a company that provides the financial guarantee to the obligee (usually a government entity) that the principal (business owner) will fulfil their obligations.

Chief Justice of India DY Chandrachud on Saturday said it was «utopian» to think that there could ever be a day when the «delivery of justice» will not be challenged. Addressing the inauguration of the International Lawyers' Conference 2023 in the national capital on Saturday, the CJI also underlined the «pivotal role» played by India in raising Supreme Court buildings in Mauritius and Bhutan. The CJI, however, said it is realistic to aspire to a world where nations, institutions and, most importantly, individuals are open to engaging with each other. «Each one of us has volumes to learn from different jurisdictions, perspectives, and most importantly each other..,» CJI Justice Chandrachud said at the inauguration of the International Lawyer's Conference on Saturday. Inaugurated by Prime Minister Narendra Modi at Vigyan Bhawan on Saturday, the inauguration was also attended by Union Law Minister Arjun Ram Meghwal. He said the programme will witness the participation of distinguished judges, legal professionals, and leaders of the global legal fraternity over the next two days. «It is utopian to think that there will be a day when we will find perfect solutions and no challenge to justice delivery.

National Asset Reconstruction Company (NARCL) emerged as the winning bidder for the debt of Dharani Sugars and Chemicals at an uncontested Swiss auction, paving the way for the promoter to submit a fresh settlement offer with the new lender, said people aware of the development. The Supreme Court had stayed a liquidation order of the sugar maker given by the National COmpany Law Tribunal (NCLT). The National Company Law Appellate Tribunal, too, had upheld the NCLT order. Lenders did not receive any counteroffer for the ₹222.5 crore binding offer by NARCL, which triggered a Swiss challenge auction held on September 18. Officials from Dharani Sugars declined to comment on the matter. Dharani Sugars, which was admitted for insolvency in July 2021, had admitted claims of ₹707 crore. The resolution professional received two plans but 91.9% of lenders rejected both on May 18, 2023.

Lenders to Bengaluru-based wood panel and laminates maker Associate Decor are awaiting the go-ahead from the National Company Law Tribunal (NCLT) more than three years after they approved a bid for the company, in what is an example of legal issues plaguing the seven-year-old Insolvency and Bankruptcy Code (IBC). Tanzania-based METL was declared the preferred bidder by lenders led by Union Bank of India (UBI) in March 2020. Its offer of ₹245 crore for the ₹604 crore debt of the company meant a recovery of 40% for lenders.

Mumbai: For the first time, private asset reconstruction companies (ARCs) are on equal footing with the government-owned bad bank NARCL. In the Dharani Sugars case, private ARCs sought a clarification on the method to compute the net present value (NPV) based on the initial bid of ₹235.9 crore. Banks responded by saying that regardless of whether it's a 100% upfront cash offer or based on a combination of cash and security receipts (SRs), the comparison value remains ₹235.9 crore, which allows private ARCs to value their bid at ₹235.9 crore on an all-cash basis or ₹331 crore using the cash to security receipt structure. A consortium of 10 banks led by Indian Bank, holding 34% of the debt, has placed a ₹619 crore loan for sale at an offer price of ₹222.5 crore and will hold Swiss Challenge on September 18. NARCL offered ₹222.5 crore as the anchor bid, with a minimum mark-up requirement of ₹13.4 crore for other challengers. Some financial institutions like the Sugar Development Fund, the Indian Renewable Energy Development Agency (IREDA), and ICICI Bank, which holds a portion of ECBs, have excluded their debt from the sale.

United Telecoms Ltd filed by one of its operational creditors. This is the second such observation from the Chennai bench of the insolvency appellate tribunal this month, after declining to entertain the petition from operational creditors. Earlier, it had refused to entertain an insolvency petition against Wipro Ltd after observing that the bankruptcy law cannot be used as a means to recover debt against solvent companies. Again, while rejecting a plea against United Telecoms last week, a two-member bench comprising justices M Venugopal and Shreesha Merla said: «Time and again, the apex court in a catena of judgments held that the IBC is not a 'recovery mechanism'. The appellate tribunal upheld the order by the Bengaluru bench of the National Company Law Tribunal (NCLT), which had dismissed the plea moved by an operational creditor claiming a default of Rs 8.46 crore against United Telecoms Ltd, which is an ICT and social infrastructure company. According to the petitioner, it had entered into a settlement agreement with the company on its request and had signed an MoU (memorandum of understanding).

Insolvency and Bankruptcy Board of India (IBBI) chairman Ravi Mital on Saturday said IBC has evolved over the years and NCLT has been approving over 35 resolutions a month, reducing delays. «Major objectives of IBC are not only recovery but revival and rehabilitation as well.

Reliance Capital’s resolution plan till the Supreme Court passed a final order. In April, the Hinduja Group emerged as the sole bidder for turning around the debt-laden firm, after the lenders completed the extended challenge process. The NCLT must now approve the Hindujas’ resolution plan, to complete the process under the Insolvency and Bankruptcy Code.

₹310 crore on matured cumulative redeemable preference shares (CRPS) since 26 August 2018. Such shares give holders the right to receive dividends even if the issuing company has missed out on paying them in the past, as per broking firm Angel One. The ₹310 crore liability arises out of the contract signed between the two firms in 2010.

Wipro Ltd. A two-member Chennai bench of the appellate tribunal held earlier that there was a pre-existing dispute over the payment between Wipro and the petitioner and observed that the Insolvency and Bankruptcy Code was not framed for being a «mere recovery legislation for creditors». The National Company Law Appellate Tribunal (NCLAT) has upheld the order of the NCLT.

Insolvency and Bankruptcy Code (IBC). According to a regulatory filing by Coffee Day to the stock exchanges September 8, the application is filed by IDBI Trusteeship Services before National Company Law Tribunal (NCLT) for alleged default of ₹228 crore.

New Delhi: The regulatory framework for professionals valuing the assets of distressed companies will continue to be strengthened as a decision on whether to salvage an insolvent business or to liquidate it depends on the valuation of its assets, the ministry of corporate affairs said in its latest monthly update. The ministry said that the work of valuers is significant given that any wrong outcome of debt resolution—salvaging a company with no chance of survival or liquidating a potentially viable one—have disastrous consequences for the economy.

the future of the defaulting company. "An accurate valuation holds absolute importance because a valuation report guides the actions of the insolvency professionals, committee of creditors and the National Company Law Tribunal and because the registered valuer endeavours to estimate a value, which is authentic and close to market conditions or realisation," the update said.

Zee Entertainment Enterprises Ltd (ZEEL) on a plea by IDBI Bank requesting initiation of insolvency proceedings against the company. IDBI’s plea is after the bank is unable to recover unpaid dues of around ₹150 crore. The Tribunal instructed both parties to submit replies and rejoinders, acknowledging that the case requires consideration.

Zee Entertainment Enterprises Limited (ZEEL) in a plea by IDBI Bank to initiate insolvency proceedings against the company. IDBI Bank, in its plea, said it was unable to recover unpaid dues of around ₹150 crore from Zee. The tribunal instructed both parties to submit replies and rejoinders, acknowledging that the case requires consideration.

IDBI bank's plea against Zee Entertainment related to insolvency proceedings on Thursday. "Learned Counsel for Appellant prays for and is allowed a week’s time to file the Additional Affidavit," said the NCLAT bench, comprising Chairperson Justice Ashok Bhushan and Member Barun Mitra, reported PTI. In its plea, the IDBI bank had challenged the orders of the Mumbai bench of the NCLT, which rejected the private lender's plea to begin the insolvency proceedings against Zee Entertainment Enterprises Ltd.

insolvency process exhibit a significant increase in business metrics, but their new owners encounter difficulties when interacting with tax officials, banks, and even the RBI, said a study by Indian Institute of Management, Ahmedabad. For instance, several of the companies claimed that banks made it difficult for them to acquire loans by refusing to remove the "defaulter" tag even after resolution. The conditions were a little tough wherever loans were offered, reported TOI. “A lack of general awareness about the new resolution process by all stakeholders has been pointed out by the respondents.

NEW DELHI : Operational creditors, who have previously aggressively initiated bankruptcy proceedings against clients for payment delays, are adopting a less confrontational stance of late. Data from the Insolvency and Bankruptcy Board of India (IBBI) for the June quarter shows that operational creditors, who had outnumbered financial creditors like banks by a wide margin in initiating bankruptcy action against defaulting firms in the five years till FY22, have for the first time fallen behind lenders in invoking the bankruptcy code during FY23.