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DFS tells public sector banks to speed up CIRP filings, cut delays at NCLT
The Department of Financial Services (DFS) has called on public sector banks (PSBs) to minimise procedural delays, particularly in filing applications under the Corporate Insolvency Resolution Process (CIRP), in an effort to accelerate the resolution of stressed assets under the Insolvency and Bankruptcy Code (IBC).
At a high-level review meeting, DFS Secretary M. Nagaraju emphasised the need for banks to expedite the admission of cases at the National Company Law Tribunal (NCLT), avoid unnecessary adjournments, and ensure that other recovery channels are actively pursued in parallel with the IBC route.
The meeting, attended by senior officials from DFS, the Ministry of Corporate Affairs, the Insolvency and Bankruptcy Board of India (IBBI), and top PSB executives, focused on improving the efficiency of the insolvency resolution process and eliminating bottlenecks that delay asset recoveries.
Banks were specifically instructed to regularly review their top twenty non-performing accounts and monitor cases where resolution plans have been pending with the Committee of Creditors (CoC) for more than three months. DFS also stressed the importance of promptly vacating stay orders to prevent further delays in the resolution process.
According to a finance ministry statement, a detailed review of cases pending for admission at the NCLT was undertaken. Banks were advised to adopt a more proactive approach in filing and following up on CIRP applications. Legal teams at banks were directed to strongly contest any attempts to stall proceedings on frivolous grounds.
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