Search

Major Reliefs due to COVID-19 for Insolvency Industry

Updated: Mar 29, 2020


Moratorium on Term Loans


All commercial banks (including regional rural banks, small finance banks and local area banks), co-operative banks, all-India Financial Institutions, and NBFCs (including housing finance companies and micro-finance institutions) (“lending institutions”) are being permitted to allow a moratorium of three months on payment of instalments in respect of all term loans outstanding as on March 1, 2020. Accordingly, the repayment schedule and all subsequent due dates, as also the tenor for such loans, may be shifted across the board by three months.


Deferment of Interest on Working Capital Facilities


In respect of working capital facilities sanctioned in the form of cash credit/overdraft, lending institutions are being permitted to allow a deferment of three months on payment of interest in respect of all such facilities outstanding as on March 1, 2020. The accumulated interest for the period will be paid after the expiry of the deferment period.


No Late Fees of delay in CRIP Forms Filling Under Regulation 40B


The filing of a Form under this regulation after due date of submission, whether by correction, updation or otherwise, shall be accompanied by a fee of five hundred rupees per Form for each calendar month of delay after 1st October, 2020.


Increase in Threshold to Initiate Insolvency Proceedings from 1 Lakh to 1 Crore


In exercise of the powers conferred by the proviso to section 4 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Central Government hereby specifies one crore rupees as the minimum amount of default for the purposes of the said section.


Extension of all Pending Proceedings before Courts/Tribunals w.e.f. 15.March.2020


This Court has taken Suo Motu cognizance of the situation arising out of the challenge faced by the country on account of Covid-19 Virus. To obviate such difficulties and to ensure that lawyers/litigants do not have to come physically to file such proceedings in respective Courts/Tribunals across the country including this Court, it is hereby ordered that a period of limitation in all such proceedings, irrespective of the limitation prescribed under the general law or Special Laws whether condonable or not shall stand extended w.e.f. 15th March 2020 till further order/s to be passed by this Court in present proceedings.


Approval of Online Mode from Classroom Mode for Valuers


In view of the advisories issued by various authorities in the wake of COVID-19, it may be difficult for RVOs to deliver educational courses and continuing education through class room sessions. To minimise difficulties for the registered valuers and valuer members, it has been decided that educational courses completed online and continuing education undertaken online shall be considered valid. Therefore, the RVOs are encouraged to deliver educational courses and continuing education online for their professional members.


Approval of Online Mode from Classroom Mode for Insolvency Professional


In view of the advisories issued by various authorities in the wake of COVID-19, it may be difficult for the IPAs to deliver pre-registration educational courses through class room sessions. To minimise difficulties for the prospective IPs, it has been decided that pre- registration educational courses completed online will be accepted for registration. Therefore, the IPAs are encouraged to deliver pre-registration educational courses online for their professional members.


0 comments