The National Company Law Tribunal (NCLT) in Mumbai has admitted an application against Jyoti Structures Ltd filed by the State Bank of India (SBI). This will be the first case of an attempted resolution of bad loans under the new Insolvency and Bankruptcy Code. The Reserve Bank of India has identified Jyoti Structures as one of the 12 large defaulters whose loans need to be resolved soon. Second, a new category of insolvency professionals will take control of corporate assets in case the issue is not resolved within the time frame. This institutional ecosystem will take time to mature, but cases like Jyoti Structures will be early milestones on the journey to a system where capital is allocated in a more efficient manner.

Source: Mint July 04, 2017 18:56 UTC