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NCLT Bench quashes 75 percent vote requirement In a trend setting order, the bench here of the National Company Law Tribunal (NCLT) has struck down an attempt byagroup of banks to block an insolvency resolution plan by citing the 75 per cent vote share requirement prescribed under Section 30(4) of the Insolvency and Bankruptcy Code (IBC). The bench of judicial member Rajeshwara Rao Vittanala and technical member Ravikumar Duraisamy approved a one time settlement (OTS) as agreed to by Kamineni Steel &Power,a Hyderabad based corporate debtor, as part of a resolution plan cleared by a group of creditors with 66.67 per cent voting power. Speaking to Business Standard on the verdict,VK Sajith, an advocate for Indian Bank that had backed the resolution plan, with four other lenders, said the bench had gone beyond only the interests of corporate debtor and corporate creditors, as the plan involved possible rehabilitation of 450 workers. Indian Overseas Bank, Central Bank of Indi

RBI holds rate tells banks to shape up Says recap will be front loaded for healthy banks; others have to prove efficiency.The Reserve Bank of India (RBI) kept its policy rate unchanged and stance neutral but its governor, Urjit Patel, set stiff conditions for ailing state owned banks to receive fresh capital from the government. Following the central bank´s fifth bi-monthly monetary policy review, the repo rate, at which the RBI lends to banks, remained at 6 per cent.All 10 economists and bond market dealers polled byBusiness Standard had predicted a pause. Ravindra Dholakia, an external member of the monetary policy committee, voted for a 25 basis point cut in interest rates.But the other five committee members, including Patel, voted for a pause. The policy statement said banks could widen previous interest rate cuts to outstanding loans, but bankers remained noncommittal about this.Among other important policy measures, the RBI said it would rationalise merchant discount rat

HIGH ON GROWTH, LOW ON CASH While the central bank maintained its neutral stance and held policy rates, it revamped merchant discount inapush foralesscash economy Liquidity to remain comfortable: RBI The Reserve Bank of India (RBI) has permitted overseas branches and subsidiaries of Indian banks to refinance the existing external commercial borrowings (ECBs), giving them a level playing field visàvis their global counterparts.They can refinance ECBs of AAA rated companies as well as Navratna and Maharatna public sector undertakings, by raising fresh ECBs, the RBI said in a statement on developmental and regulatory policie "The decision in allowing subsidiaries of Indian banks abroad to refinance AAArated corporates will provide a fair and just opportunity to Indian banks to book and retain good quality assets," State Bank of India Chairman Rajnish Kumar said.Currently, Indian corporates are permitted to refinance their existing ECBs atalower all in cost. The oversea

Importers of food cosmetics to get refund on excess GST Unsold inventory of imported chocolates, confectionery and cosmetics, which attracted 28% Integrated Goods & Services Tax (GST) during inbound shipments but are now retailing with an 18% levy, can claim refunds on the excess tax paid. “We have told importers that if they have imported goods at 28% and are selling them at 18%, they can claim a refund,” a senior official at the Central Board of Excise and Customs (CBEC) said. “They will, however, have to submit proof. We understand they have issues related to stickers.” All imports face customs duty and IGST (CGST+SGST), unless specifically exempted. Last month, the GST Council had slashed tax slabs on 178 products, including chocolates, confectionery, deodorants and shampoo, from 28% to 18%. Almost all Indian firms have dropped prices in relevant categories after the cut. “The reduction in GST rates for products imported at a higher rate may have some shortterm workin

No change in norms RBI defends inspection regim The Reserve Bank of India defended its inspection regime and said that the divergence between the actual numbers reported by the banks and its assessment of bad loans is nothing extraordinary, and it is not moving the goal post. The only difference now, the central bank asserted, is that banks are disclosing these numbers, unlike in the past. Speaking for the first time on the issue of banks reporting huge divergences at the end of the September quarter earnings, the Reserve Bank of India on Wednesday said that the banks had not followed RBI’s asset classifications rules to the tee. “I want to make it very clear that there has been no change in the goal post, the rules haven’t changed,” said NS Vishwanathan, deputy governor, RBI. “We have assessed the banks classification on rules as they are today. We have found that in some cases, they have not applied those criteria.” The RBI’s scrutiny of non-performing assets has raised sever