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Tag: insolvency

Coronavirus: Ministers eye extension of insolvency measures

Coronavirus: Ministers eye extension of insolvency measures

Business
Ministers are in talks to extend a moratorium aimed at preventing a deluge of company insolvencies amid fears that renewed trading restrictions will tip thousands of businesses beyond the brink of collapse.Sky News has learnt that officials are discussing an extension of the ban on statutory demands being used as the basis for winding-up petitions, which has been in place since late April. The move is expected to be finalised within a matter of days, given that the moratorium expires at the end of the month.Sources said this weekend that an extension was not yet guaranteed but was "overwhelmingly likely".The measure was one of several included in the government's Corporate Insolvency and Governance Act, which became law in June. ...
IBBI tightens norms for insolvency resolution professionals

IBBI tightens norms for insolvency resolution professionals

Finance
NEW DELHI: In a significant move, the Insolvency and Bankruptcy Board of India (IBBI) has tightened norms governing resolution professionals wherein restrictions will also be in place for their relatives from taking up employment after completion of a resolution process. Insolvency resolution professionals would be barred from having employment when they are in possession of authorisation to take up work under the insolvency law. Besides, an insolvency professional and his or her relatives cannot accept any employment from the successful resolution applicant concerned for one year, as per the amended norms. An insolvency professional should not undertake any assignment unless he or she holds an 'Authorisation for Assignment' issued by the insolvency professional agency concerned. This woul...
View: India’s insolvency law as creator of jobs

View: India’s insolvency law as creator of jobs

Finance
By Sapan GuptaThe new corporate insolvency regime has saved nearly four lakh jobs in India. Had it not been for the new law being enforced in December 2016, these jobs would have perished in the tepid business environment and ballooning debt of corporate India. Under the insolvency regime, a total of 88 cases have been resolved so far, securing revenue of Rs 31,651 crore, with employee salaries of around Rs 2,350 crore. At an estimated average salary of Rs 30,000 a month per person, this translates to a direct employment of 65,250. Then there are jobs of vendor partners, sales outfits, housekeeping contracts, transporting contracts and security services. Recent analyses by human resource firms show that one direct employee in a company creates five more jobs outside. In the upcoming six m...
Guarantors too will be in insolvency net

Guarantors too will be in insolvency net

Finance
The insolvency regulator is readying rules that will enable creditors to go after guarantors of ailing companies to recover dues, a move that will tighten the grip around companies as well as their promoters who had given personal covers. The Insolvency & Bankruptcy Board of India (IBBI) is working on guidelines that are expected to be ready in the next few weeks, sources said, adding that the idea is to help banks and individuals recover dues from guarantors where they have failed to have the entire claims settled during the resolution process, sources told TOI. When contacted, IBBI chairman M S Sahoo confirmed the development. “We are working on rules and regulations to operationalise insolvency of personal guarantors in companies,” Sahoo said. The regulations will also s...
Andhra Bank withdraws insolvency petition against HDIL

Andhra Bank withdraws insolvency petition against HDIL

Finance
Andhra Bank has withdrawn its insolvency application from the National Company Law Tribunal (NCLT) against HDIL as the realty firm has decided to settle outstanding dues."The company has proceeded for settlement of its balance outstanding dues and has made part payment of its balance dues. The application stands withdrawn from NCLT by Andhra Bank," HDIL said in a BSE filing.The Mumbai-based developer did not disclose the amount it has paid and the dues still owed to the bank.HDIL reported 64 per cent increase in consolidated net profit to Rs 60.87 crore for the quarter ended September, as against Rs 37.03 crore in the year-ago period.Total income, however, fell to Rs 163.07 crore in the second quarter of the current fiscal, from Rs 223.26 crore a year ago. Profit rose sharply as the compa...