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Focus should be resolution, not liquidation: Sahoo

Press Trust of India  |  Kolkata 

The of and Board of India (IBBI) M S Sahoo today said that the focus on cases coming under and Code (IBC) should be on resolution and not to maximise the value of corporate debtors.

He said that the soul of the Code was to keep the firm alive by balancing the interest of all stakeholders for which a successful resolution was needed.

Sahoo said that this was not happening at the moment.

Speaking at a CII event here, Sahoo said "this is not happening. But there is nothing to worry. Our effort will be on resolution. For that to happen, the resolution value has to be higher than the value".

To encourage resolutions to take place, the voting threshold had been lowered from 75 per cent to 66 per cent, he said.

He said that out of 850-odd cases which had been referred to the NCLT, 130 of them were either in the stage of a resolution or One hundred of the 130 cases had been referred for liquidation, he said.

On the (CoC) which comprised mostly lenders, he said, it was a determining role to select suitable people in taking over a business and keep it running.

Sahoo said that regulations on non-entertainment of late bids and no negotiations with late bidders would be announced soon and would be in force with prospective effect.

K R Jinan, member of NCLT Kolkata bench, said that there had been instances of non-cooperation by the corporate debtors with the resolution professionals.

"Sometimes lenders refuse to the Resolution Professionals to see resolution is through as a going concern," he said.

said the implementation of the Code was at an initial stage. "It has to be implemented in its true spirit. For that, periodical review is needed for successful resolution of stressed assets".

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sat, June 09 2018. 14:25 IST
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