Banks have been gearing up to recover their default or bad loan. In such a situation, many banks are looking for a legal way to break this jugaad of nobles.
Vijay Mallya and Nirav Modi. (File Photo)
The Supreme Court had taken an important decision last week to prevent any other work in the country like Vijay Mallya and Nirav Modi. In fact, with thousands of crores of banks showing their company bankrupt and fleeing abroad with ease of bank money, now the promoters and owners of those big companies are overshadowed. The Supreme Court had given an important decision on bad loans on Friday, the effect of which is now visible on the big companies and big nobles of the country.
In fact, last week on Friday, the Supreme Court upheld the validity of the Centre’s notification allowing banks to take action against individual guarantors for debt recovery under the Insolvency and Bankruptcy Code (IBC). Now after this decision, the promoters of many companies are trying to avoid it.
Promoters are making such a jugaad to escape
After the decision of the Supreme Court, promoters of many big companies may come to grief as the bank can recover its personal guarantee in the form of bankrupting the company. To avoid this, many promoters have formed the Family Trust. But now banks are also targeting the family trust for loan guarantee. According to the report of the Economics Times, now that banks can identify such trusts and promoters, the trust is trying to break the IBC.
What is the legal way
Banks have been gearing up to recover their default or bad loans. In such a situation, many banks are looking for a legal way to break this jugaad of nobles. In fact, after the decision of the Supreme Court, the creditors can seize the personal guarantee of the promoters of the companies to recover their money. Promoters who are engaged in manipulating the money by creating trusts are being told that 5 to 10 per cent stake of those promoters is being mentioned. Banks and other creditors are also investigating this. Many promoters have also established similar trusts in India and outside India. Now such trusts can also come under scrutiny.
Their difficulties can also increase
This decision of the court can increase the difficulties for businessmen like Anil Ambani, Kapil Wadhawan and Sanjay Singhal. After this decision of the court, banks can now file a case of personal bankruptcy against the promoters of companies whose companies have been sent to the NCLT for debt resolution. The names of businessmen like Anil Ambani, Kapil Wadhawan and Sanjay Singhal are included in this list.
NCLT has a long list
The IBC Act was enacted in 2016, but by the end of 2017, at least 52 companies were sent to the NCLT for default in payment of bank loans. These included Videocon Industries, Bhushan Steel, Punj Lloyd and Essar Steel. After this decision, it will be easier for the bank to recover money from the personal guarantor.
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