Mumbai: A year after the Reserve Bank of India (RBI) tightened the screws on companies delaying debt payments, the Supreme Court is poised to begin hearing arguments on whether the banking regulator’s diktat applies across industries.
Hanging in the balance is the fate of more than $25 billion of loans to power producers. They are among parties contesting RBI’s 12 February circular that forced banks to recognize loans as non-performing assets (NPAs) if dues are delayed even by a day and to approach bankruptcy courts if a restructuring isn’t agreed to within 180 days.
The top court in September halted proceedings against power, sugar and shipping companies after they challenged RBI’s one-day default norm.
