New Delhi, Jan 3: “Increase in the conversion of NPAs into standard accounts and decline in new accounts falling in NPA category show a definite improvement in the lending and borrowing behaviour.” Tweeted Finance Minister Arun Jaitley.
Arun Jaitley has written a blog post on two years of the Insolvency and Bankruptcy Code (IBC), providing data pertaining to its effectiveness in sorting out the high percentage of NPA (Non-performing Assets) on the books of Indian banks.
So far 1322 cases have been admitted by The National Company Law Tribunal (NCLT). 4452 cases have been disposed at a pre-admission stage and 66 have been resolved after adjudication. 260 cases have been ordered for liquidation. In 66 resolution cases, the realization by creditors was around Rs. 80,000 crores.
As per NCLT database, 4452 cases disposed at a pre-admission stage, the amount apparently settled was around Rs 2.02 lakh crores. Some of the big 12 cases are likely to be resolved in this financial year in which realization is expected to be around Rs 70,000 crores.
The IBC was approved by both Houses of Parliament in May 2016. This was the quickest Economic legislative change that I have seen being made by Parliament. The NCLT was immediately constituted, the Insolvency Bankruptcy Board of India was established and the regulations were framed. By the end of 2016 corporate insolvency cases were being received by the NCLT.
Wrote Finance Minister in his blog.
What is NCLT?
The National Company Law Tribunal (NCLT) is a quasi-judicial body in India that adjudicates issues relating to Indian companies. The NCLT was established under the Companies Act 2013 and was constituted on 1 June 2016 by the government of India & is based on the recommendation of the justice Eradi committee on the law relating to insolvency and winding up of companies.
The National Company Law Tribunal is the Adjudicating Authority for Insolvency resolution process of Companies and Limited Liability Partnerships under the Insolvency and Bankruptcy Code, 2016.
The NCLT has thirteen benches, two at New Delhi (one being the principal bench) and one each at Ahmedabad, Allahabad, Bengaluru, Chandigarh, Chennai, Guwahati, Hyderabad, Jaipur, Kochi, Kolkata and Mumbai.
Decisions of the NCLT may be appealed to the National Company Law Appellate Tribunal (NCLAT). The decisions of NCLAT may be appealed to the Supreme Court of India.