Financial creditors have expertise to resolve RBI-referred NPA cases: Sahoo

He says there is no clash between mechanism of insolvency and RBI's oversight committee

As an RBI-constituted committee identified 12 high-ticket non-performing assets of banks to be resolved under the Insolvency and Bankruptcy Code (IBC), Insolvency and Bankruptcy Board of India chairman M S Sahoo tells Indivjal Dhasmana that the country has an adequate bandwidth of professionals and financial creditors to resolve these cases. Edited excerpts:

Does the National Company Law Tribunal (NCLT) have adequate infrastructure to handle such big-ticket cases of non-performing assets of banks?

The role of NCLT is an admission of default. Its role is not a resolution of the case. Resolution is done by a committee of financial creditors. I am sure that financial creditors, being the financial market experts, have the bandwidth to resolve insolvencies within 180 days.

Do we have an adequate number of insolvency professionals and required expertise to take up these cases?

Insolvency professionals provide professional services to a committee of creditors. Decisions are taken by the committee of creditors. We have an adequate number of qualified professionals to help the committee of creditors. We have two categories of such professionals. There are 977 professionals whose registration validity is limited to six months and 300 people as full-time professionals. The number-wise and qualification-wise we have adequate strength. These are company secretaries, chartered accountants, cost accountants, advocates with ten years of experience and certificate of insolvency examination.

Some bankers say that the whole issue could become a legal bone of contention as cases could be stretched to 270 days...

There is no legal issue here. The normal time is 180 days to complete resolution. There could be a few cases where one needs more than 180 days, but there could also be a few cases where one needs less than 180 days, depending upon the complications, size of the transactions. Initially, there could be cases that may not be completed in 180 days which could seek an extension.

Do you see any clash between this mechanism of insolvency and RBI's oversight committee?

I don't see it.

Going forward, do you see more such cases coming up for the insolvency route?

It depends. Banks have other options as well. It depends on their priorities. If for example, a bank is looking only for a recovery, he may not choose the insolvency route.