Earlier in the day, the apex court, on a petition filed by power firms, held the February 12, 2017 circular of the Reserve Bank as unconstitutional. A detailed verdict is awaited as to what would be status of the resolution of those companies already arrived at under the circular. A legal expert who specialises in bankruptcy laws opined that the RBI circular was considered a bit too stern by many in the industry, especially the 180 days deadline. "With the RBI circular being struck down, the earlier circulars of RBI would stand revived which were changed by the impugned circular and now those companies can request the lenders to reconsider their restructuring plans," he added. Details from the order are yet to be seen as to what will happen to the companies which are already before NCLT due to impugned circular, he pointed out.

Source: Mint April 02, 2019 14:37 UTC