Entries by Staff Publication

Sectoral regulators empowered to petition insolvency of financial services providers: Central Govt notifies insolvency rules

–Vinod Kothari (resolution@vinodkothari.com)  The Central Govt on 15th November notified rules of procedure for insolvency proceedings for financial services providers, thereby indicating that the resolution and liquidation process for financial services entities has been taken out from the proposed enactment dealing with distress of financial entities. Notably, the actions in case of distress of financial […]

Financial Service Provider under the clutch of IBC? Nature of the “debt” vs. Nature of the “debtor”

-Megha Mittal (resolution@vinodkothari.com) In a first of its kind, the Hon’ble National Company Law Tribunal, Principal Bench at New Delhi (“NCLT”) vide its order dated 04.11.2019[1] in the matter of Apeejay Trust v. Aviva Life Insurance Co. India Ltd., has initiated corporate insolvency resolution process against the Corporate Debtor, despite it being a financial service […]

SEBI tightens its norm on resignation of auditors

– Priya Udita resolution@vinodkothari.com OVERVIEW Observing that a lot of statutory auditors of the companies are abruptly resigning before completing their tenure either due to lack of cooperation or lack of information provided by the company, SEBI has taken the matter in its hand to strengthen the norms. Consequently, SEBI issued a Consultation Paper[1] on […]

RBI revises qualifying assets criteria for NBFC MFIs

Team, Vinod Kothari Consultants Pvt. Ltd. finserv@vinodkothari.com The RBI on November 08, 2019[1] revised the limits relating to the qualifying assets criteria, giving a much needed boost to Micro-Finance Institutions. The change in limits comes pursuant to the Statement on Developmental and Regulatory Policies[2] issued as part of the Monetary Policy Statement dated 04 October, […]

Group Insolvency: Moving from “Entity” to “Enterprise”

-Sikha Bansal (resolution@vinodkothari.com)   Recently, the Working Group led by Shri U.K. Sinha, submitted its Report on group insolvency, recommending a complete framework to facilitate insolvency resolution and liquidation of corporate debtors in a “group”. The Report was submitted by the working group on 23.09.2019. See our presentation here on various aspects of group insolvency proceedings as suggested […]

Special Window Fund for Affordable Real Estate Segment: Achche Din for Home-buyers?

– Sikha Bansal and Priya Udita (finserv@vinodkothari.com) Relief has come to the builders of stalled housing project and distressed homebuyers in in the form of establishment of a ‘Special Window‘ fund by the Government to provide priority debt financing for the completion of stalled housing projects that are in the affordable and middle-income housing sector. […]

Case Update: SC extended the CIRP by exercising Article 142 of the Constitution

-Priya Udita (resolution@vinodkothari.com) The Supreme Court (SC) in the case of Jaiprakash Associate Ltd. & Anr. v. IDBI Bank Ltd. & Anr. dealt with 2 issues. Firstly, whether the National Company Law Tribunal (NCLT) or National Company Law Appellate Tribunal (NCLAT) can exclude any period from the statutory period in exercise of inherent powers sans […]

Working Group proposal for stricter vigilance on CICs

-By Anita Baid anita@vinodkothari.com, finserv@vinodkothari.com Regulators and stakeholders have been seeking a review of Core Investment Companies (CIC) guidelines ever since defaults by Infrastructure Leasing and Financial Services Ltd (IL&FS), a large systemically important CIC. In August 2019, there were 63 CICs registered with the Reserve Bank of India (RBI). As on 31 March, 2019, […]

Timely Realisation of Assets by Secured Creditors- IBBI’s Discussion Paper on Liquidation Process Regulations

-Megha Mittal (resolution@vinodkothari.com)  The Insolvency and Bankruptcy Board of India (“IBBI”/ “Board”) has invited comments on its Discussion Paper on Corporate Liquidation Process[1], dated 03.11.2019 (“Discussion Paper”), which essentially deals with two issues which have been the focal point of contrasting opinions as well as judicial interpretation at various instances, i.e. (a) Relinquishment of Security […]