Tuesday, August 16, 2016

LS clears the Enforcement of Security Interest and Recovery of Debt laws and Miscellaneous Provisions Bill, 2016

  • RBI oversight of the asset reconstruction companies.
  • Central registry to record details of all secured assets.
  • Priority of debts due to secured creditors over all other debts and claims.
  • Time for filing appeal to the Appellate Tribunal cut from 45 days to 30 days.
  • 50% of debt to be deposited for filing an appeal; can be cut to 25%in some cases.
  • Right to take over secured property; appointing receiver for such property and to sell the same.
  • Time can be given to borrower if 25% debt deposited with promise to pay full.
  • Depositories empowered to transfer asset to ARC.
  • A fit and proper person can sponsor an ARC.
  • Protection for secured creditor, RBI, central registry or any of their officers for action taken in good faith.

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