The National Company Law Tribunal (NCLT) on Monday directed the Synergy Group, the sole entity interested in the beleaguered Jet Airways, to appear before it and present a plan by December 3, The Financial Express reported. The direction came after the resolution professional (RP) for Jet Airways, Ashish Chhawchharia, told the bench that Colombia-based Synergy Group sought additional time till February to firm up its plans for Jet Airways. Cash-strapped Jet Airways has been grounded for seven months now and the airline was admitted for insolvency on June 20.
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India unveiled rules to help creditors recover loans due from large shadow lenders as a prolonged upheaval in the nation’s credit markets raises the risk of defaults by the financiers, Bloomberg News reported, The amended law provides a generic framework for insolvency and liquidation proceedings of systemically-important financial services providers, other than banks, according to a government statement on Friday. The 15-month-old credit crisis has choked economic growth to its slowest pace in six years, while company defaults on rupee bonds are at a record high.
India’s central bank chief Shaktikanta Das called for stronger corporate governance at state-run lenders to make the country’s banking sector more efficient. Describing the lack of strict governance as the “elephant in the room,” Das said this had led to elevated levels of non-performing assets, capital shortfalls, fraud and inadequate risk management, Bloomberg News reported.
India has amended its insolvency and bankruptcy rules to allow for greater flexibility in resolving problems at troubled non-banking finance companies (NBFCs), the government said in a statement on Friday, Reuters reported. The change follows debt defaults at shadow lender Dewan Housing which owes close to 1 trillion rupees ($14 billion) to its debtors, who include banks and mutual funds. The new rules however, say insolvency proceedings against such NBFCs or financial service providers can only go ahead if the appropriate regulator requests such action.
The Indian economy continues to slow. The monthly Index of Industrial Production fell to an eight-year low in the month of September, contracting by over 4%. According to India’s central bank, growth in bank credit to industries in the same month fell to 2.7%, the lowest in a year, a Bloomberg View reported. While the numbers for services are a little better, even they stand at a two-year low. Economists have little faith that things will turn around on their own. The government desperately needs to revive investment.
After posting the worst quarterly loss in India’s corporate history, Vodafone Group Plc’s besieged local venture is appealing for urgent relief from the government to help avert a collapse, Bloomberg News reported. Facing a $4 billion demand from India to cover past dues, Vodafone Idea Ltd. took a one-time charge that led to a net loss of 509 billion rupees ($7.1 billion) in the three months through September.
The National Company Law Appellate Tribunal (NCLAT) on Wednesday granted the market regulator SEBI one "last chance" to file its reply on the revised share delisting norms for companies under insolvency, Business Standard reported. A two-member NCLAT bench headed by Chairperson Justice S J Mukhopadhaya has granted one day time to SEBI for filing of affidavit and said that failing which, it will proceed ahead in the matter. "It is stated that the copy of the affidavit filed by SEBI has been served on the counsel for the parties.
Indian shares edged lower on Thursday, after retail inflation breached the central bank’s medium-term target of 4% for the first time in 15 months, while lenders fretted about a possible insolvency of Vodafone Idea, Reuters reported. Annual retail inflation rose to 4.62% last month on higher food prices, but most economists expect the central bank to look past the inflation print and cut rates for a sixth straight time next month. Higher inflation and reports of a liquidation of Vodafone Idea were pulling down the markets, said Sumit Pokharna, vice president, Kotak Securities.
Lenders of debt-ridden Jaypee Infratech will meet on 18 November to take forward the process of insolvency resolution after the Supreme Court directed early this month to complete the process within 90 days, Firstpost reported. Crisis-hit Jaypee group firm Jaypee Infratech went into insolvency in 2017 after the National Company Law Tribunal (NCLT) admitted an application by an IDBI Bank-led consortium seeking resolution of the firm. Jaypee Infratech, a subsidiary of Jaiprakash Associates, has an outstanding debt of nearly Rs 9,800 crore.
Insolvency regulator IBBI is serious about enforcing a recently enacted legal provision to ensure completion of the corporate insolvency resolution process (CIRP) in a time-bound manner, The Hindu Business Line reported. It has asked registered insolvency professionals to furnish details of all ongoing CIRP, which is not completed within 330 days. Reasons for non-compliance and details of persons responsible for non-completion have to be furnished to the regulator to enable it to take appropriate legal remedy.