The Reserve Bank of India’s (RBI’s) decision to ask banks to file for insolvency in the case of 12 major non-performing assets (NPAs) has put a question mark over the capacity of the National Company Law Tribunal (NCLT).
In the entire process of insolvency, the tribunal is the key stakeholder. It decides whether a case if fit for admission under the Insolvency and Bankruptcy Code of 2016.
Insolvency professionals say the infrastructure won’t suffice to handle the pressure that will emerge due to RBI’s move. Mamta Binani, an insolvency professional, says more benches of NCLT are required and some of the single-member ones should become double-member. There are 11 benches, including those in the four largest cities. After admission, companies have 180 days for resolution, extendable to 270 days if the regulator deems fit. Read More…
Credit By: Business Standard
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