The government sought to tighten the Insolvency and Bankruptcy Code (IBC) through an ordinance to ensure that wilful defaulters and promoters of companies in loan default over an extended period of time wont be able to get their hands back on assets during the resolution process. The ordinance comes in the wake of concerns that promoters who had defaulted on loans and caused banks to take deep haircuts were trying to regain control of their companies, government sources said. The move is aimed at ensuring that such attempts at backdoor entry in the guise of resolution applicants are prevented, they said.
This suggests that promoters of 11of the dozen big loan default cases referred by the Reserve Bank of India for resolution may not b…
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