India is preparing an enabling provision for a compact and largely informal bankruptcy settlement process for faster resolution for large firms under the over-arching Insolvency and Bankruptcy Code (IBC), on the lines of the one available for micro, small, and medium enterprises (MSMEs), the Economic Times reported.
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In a relief to low-cost carrier SpiceJet, the National Company Law Tribunal (NCLT) on Monday dismissed an insolvency petition by aircraft lessor Willis Lease Finance Corporation which is claiming dues, the Business Standard reported. A two-member Delhi-based NCLT bench rejected the plea moved by U.S.-based Willis Lease Finance Corporation after SpiceJet questioned the maintainability of the petition. SpiceJet opposed the plea contending that Willis Lease Finance Corp. has withdrawn its insolvency plea for the same dispute in March 2023 and has approached again with a new plea.
The Insolvency & Bankruptcy Board of India (IBBI) is expected to finalise crucial amendments to regulations - from those seeking to make life simpler for home buyers to those for personal and companies' insolvency proceedings, insolvency professionals and liquidation - next month as it seeks to improve the seven-year-old regime and improve its overall functioning, the Times of India reported.
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India's Jindal Power Ltd, the only company whose expression of interest to take over Go First was accepted by creditors, has decided to not follow through with a bid, three people familiar with the plans said, pushing the insolvent airline closer to liquidation. The deadline to submit takeover bids ends on Tuesday, and the sources told Reuters Jindal had decided against bidding after evaluating the airline's financial statements. While the deadline can be extended via an application to the courts, creditors are currently not inclined to do so, two banking sources said.
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An apex court ruling in India allowing bankruptcy proceedings against personal guarantors of defaulting borrowers is set to raise the recovery rate for public-sector lenders to at least 19% from about 14% now, industry estimates showed, The Economist reported. "The recent ruling has potential to improve the recovery in existing written-off accounts, many of which are through the bankruptcy code, and result in 5 percentage point incremental recovery from personal guarantees," said Hari Hara Mishra, CEO, ARC Association.
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Lenders to India's Go First are not in favor of releasing additional funding to the grounded airline, given its legal troubles with lessors and complexities related to changes in the bankruptcy law, two banking sources told Reuters on Monday, Reuters reported. Go First's lenders, which include the Central Bank of India, Bank of Baroda, IDBI Bank and Deutsche Bank, had in principle approved funding of 4.50 billion rupees ($54.09 million) in June to resume operations and restart the airline.
The National Company Law Tribunal (NCLT) has admitted Siti Broadband Services, a subsidiary of Essel Group-owned cable TV and broadband company Siti Networks, into the corporate insolvency resolution process following a plea by lender Aditya Birla Finance, msn.com reported. The NCLT has appointed Harvinder Singh as an interim resolution professional (IRP) for the company. Aditya Birla Finance moved NCLT following a default in payment of ₹4.38 crore by Siti Broadband.
India's biggest airline, IndiGo, said on Friday it would lease new planes and extend agreements on some older ones to offset the disruption from new problems with Pratt & Whitney engines, Reuters reported. Pratt & Whitney parent RTX said in July a rare powder metal defect could lead to the cracking of some engine components in the twin-engined Airbus A320neo, and called for accelerated inspections.
Changes to Indian laws to exclude leased aircraft from assets that can be frozen during bankruptcy proceedings of an airline "would have to be considered" retrospectively, the country's aviation regulator said in a court filing on Wednesday, Reuters reported. The clarification of India's recent amendment to its insolvency law potentially paves the way for lessors of bankrupt budget carrier Go First to take back their planes. Go First filed for bankruptcy in May but its lessors were blocked from repossessing planes due to a moratorium imposed by Indian courts.
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