From now on, RPs will also be expected to look into borrowing agreements that companies have entered into to find out if there have been any extortionate credit transactions
There is no doubt the corporate insolvency resolution process (CIRP) hasnt quite lived up to expectations. Although the Insolvency and Bankruptcy Code is an excellent piece of legislation, the insolvency process has been hobbled by delays and litigation, and has resulted in lower-than-expected recoveries for lenders. While the NDA government has worked overtime to plug the loopholes, more often than not, the stressed firms have been sold at surprisingly low valuations. Indeed, at a shade under 40%, the recoveries for lenders are abysmally low. That the process coul…
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