INSUBCONTINENT EXCLUSIVE:
New Delhi: Public Sector Banks (PSBs) may now use provisions of Project Sashakt to deal with economically unviable projects, said a senior
government official, adding that lenders could still initiate corporate insolvency proceedings if there is no other mode of resolution
unconstitutional.
Under the aegis of Project Sashakt, 35 banks have signed an inter-creditor agreement (ICA), which provides the framework
to resolve assets through a bank-led resolution approach (BLRA)
Under the agreement, if the lead bank is unable to implement a resolution plan in 180 days, the assets will then move to the National
Company Law Tribunal (NCLT) process.
The Supreme Court, in its judgement on Tuesday, held the Reserve Bank of India (RBI) directions issued
amount was due from one to 30 days.
Banks were also directed to find resolution for stressed firms with exposure greater than Rs 2,000 crore
within 180 days, failing which lenders had to initiate insolvency proceedings
The RBI circular had also scrapped corporate debt restructuring (CDR), strategic debt restructuring (SDR), scheme for sustainable
defaults as the IBC process had settled into place
A finance ministry official said that as per the Insolvency and Bankruptcy Code, even if an asset in not classified as an NPA, it can still
resolution process is also backed by an oversight committee
