In order to aid a better valuation system of bankrupt companies under the insolvency process , the government is planning to bring in a separate legislation for registered valuers , Corporate Affairs Secretary Injeti Srinivas said on Saturday.
Only seven out of the 40 largest NPA accounts sent to various National Company Law Tribunals (NCLTs) since last July, which together constitute around 40% of over Rs 11 trillion worth of bad loans, had been resolved so far, where the banks took an average haircut of over 60% since some accounts such as Alok Industries were bid out for only 17% of the money owed to lenders.
Since the Insolvency and Bankruptcy Code (IBC) was stabilising, Srinivas said proper valuers were the critical missing link in the process since most insolvency professionals were poorly equipped since it was a new area for them. “You have registered valuers now. But you do not have a separate law for them. We are looking at the possibility of a separate law, say for chartered accountants, or company secretaries. We are assessing whether we can have a full- fledged law to regulate them as they are most critical in the success of the insolvency process.”
In this event organised by industry chamber CII, MS Sahoo, chairman, Insolvency and Bankruptcy Board of India, said that in this whole process registered valuers play a critical role .
Source : Livemint , August 18’2016.