Fear Of Courts Shouldn’t Deter Bad Loan Clean-Up, Says Insolvency Board Chief
The prospect of a law being challenged in courts should not deter policy makers from taking appropriate decisions, India's insolvency board chief MS Sahoo said, defending the recent amendments in the Insolvency and Bankruptcy Code.
“We cannot sacrifice the sole objective of the code just to enable a few people,” Sahoo told BloombergQuint in an interaction. “Even if there is a deficiency in the law then the court has a right to guide us,” he added.
His comments came after the government amended the IBC to bar defaulting promoters and nine other types of entities from bidding for non-performing assets. Experts including top corporate lawyer Cyril Shroff and governance advisory firm founder Anil Singhvi argued that the government may have gone too far by keeping promoters out of the bidding process. This would hurt recovery for lenders, they added.
If the objective of having “clean and credible” people run a business, results in a few people being left out, that isn't a bad thing, Sahoo said.
Also Read: Insolvency Ordinance Meets With Cautious Cheer From Bankers
The chairman of the Insolvency and Bankruptcy Board of India explained that the amendments are not a standard specified only for promoters but are applicable to everyone interested in submitting bids for the defaulting companies. “The objective is that people with clear antecedents come and take over the corporate which is being resolved,” he said. The people who take over must submit financially sound resolution plans and have the capability to translate it into action.
We can't put it (defaulted assets) in the hands of a person who doesn't have a track record of turning around assets.MS Sahoo, Chairman, Insolvency and Bankruptcy Board of India
Sahoo remained confident that the amendments would withstand challenges in courts.
Of the 12 cases referred to the IBC under direction by the Reserve Bank of India, none have reached a resolution within the 180-day timeline and the process may get extended by another 90 days as per procedure, he said.
Watch the full interview here.
Also Read: BQExplains: Ordinance That Amends IBC And Delivers A Stern Message To Promoters
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
-
Joining The Dots | Dark Skies, Steady Diya: Why Hope Holds This Diwali
With war, a weak rupee and foreign outflows weighing on sentiment, policymakers at the NDTV World Summit and market veterans at NDTV Profit Ignite: Diwali Edition offered the same advice: stay invested and filter out the noise.
-
The Curious Case of Equitas Small Finance Bank And A CEO Who Quit For Stock
PN Vasudevan believes persistent investor concerns over a perceived conflict of interest had become a governance overhang on Equitas Small Finance Bank's stock, even as the lender improved profitability and asset quality.
-
Talking Points This Week: AI Cash Burn, A Tiger Comeback And An India That Still Finds Its Own Path
India is not immune to higher oil or tighter global liquidity, yet its earnings base is broader, its domestic policy levers are still available.
-
Foreign Investors Own Half Of HDFC Bank and ICICI Bank. An LTCG Cut Could Matter Most Here
Foreign portfolio investors have US$115 billion parked in HDFC Bank, ICICI Bank. If the government cuts long-term capital gains tax, Jefferies says returning foreign money could land here first.
-
'Never Seen This Level Of Negativity': Sandeep Tandon Says The Next Rally May Be Closer Than You Think
Veteran investor Sandeep Tandon says foreign selling is easing, large-caps are due a comeback and mid-caps are crowded, while he turns positive on gold, power and pharma this Diwali.
-
Indians Stay With Family, Not In Hotels | The Reason Why
India still lacks enough clean, reliable and affordable hotels for budget-conscious travellers.
