Apex Court squashes RBI's Feb 12 Circular on Stressed Assets Resolution : A Decode

Mint 2019-04-05

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The Supreme Court on Tuesday quashed the Reserve Bank of India’s (RBI) 12 February circular which prescribed rules for recognizing one-day defaults by large corporates and called for insolvency action as a remedy. The court’s decision restored the discretion of banks on debt resolution. The ruling is a significant one as it may affect stressed assets worth around Rs 2.2 lakh crore in many sectors and questions are being raised if it would also mean unwinding the insolvency resolution process that has already been done. In a video discussion with Livemint, experts decode the Supreme Court's act and its implications for various stakeholders.

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