Latest news with #SecuritisationandReconstructionofFinancialAssetsandEnforcementofSecurityInterestAct
&w=3840&q=100)
Business Standard
29-05-2025
- Business
- Business Standard
McLeod Russel in discussion with NARCL for composite debt resolution
McLeod Russel India has submitted an initial proposal to the National Asset Reconstruction Company Limited (NARCL) for resolution of its debt. In March this year, most lenders—except IndusInd Bank—assigned their loan accounts in India's largest bulk tea producer to NARCL. In its results disclosure, McLeod stated that borrowings from banks aggregating to Rs 1,033.03 crore, representing the principal amount, had been assigned to NARCL. This was done under an Assignment Agreement dated 12 March 2025, executed under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). According to McLeod sources, the company is now seeking a composite resolution of its total debt and has initiated engagement with NARCL. In its notes to results, McLeod mentioned that management is confident that a resolution will be reached regarding borrowings from asset reconstruction companies (ARCs) and banks, aggregating to Rs 1,461.07 crore. The company expects to arrive at a sustainable repayment amount, including associated costs, along with an agreed repayment timeline in due course. In addition to NARCL, McLeod will also have to engage with IndusInd Bank and JC Flowers ARC. While realisation from tea sales had improved to some extent, the company suffered crop losses due to adverse weather conditions, impacting overall operations and performance. The company further noted that inter-corporate deposits (ICDs) extended to various promoter group entities and others in earlier years, along with accrued interest, remain outstanding as of the reporting date. In the January–March quarter (Q4FY25), McLeod reported a net loss of Rs 174.41 crore, down from Rs 218.42 crore in the corresponding quarter of the previous year. Revenue from operations stood at Rs 165.47 crore in Q4FY25, compared to Rs 194.95 crore a year earlier. For the full year FY25, revenue was Rs 1,185.41 crore, compared to Rs 1,135.89 crore in FY24. The net loss for FY25 stood at Rs 197.87 crore, down from Rs 311.59 crore in FY24.
The Hindu
05-05-2025
- Business
- The Hindu
‘Benefits of scheme for revival of NPA account is not permissible when MSME is closed or wound up'
The High Court of Karnataka has said that benefits of the scheme for restructuring or revival/rehabilitation of a bank account, which has become a non-performing asset (NPA), of a micro, small and medium enterprise (MSME) is permissible under the law only if the MSME is functioning. Justice M. Nagaprasanna passed the order while rejecting a petition filed by M/s Metro Steel Section, which has questioned the proceedings initiated by the State Bank of India to recover about ₹18.5 crore loan due to the bank from the petitioner-firm. It was contended on behalf of the petitioner that the benefit of rectification and restructuring of loan amount as has been provided in the notification, issued by the Reserve Bank of India (RBI) in 2015 under Section 19 of the MSME Development Act, 2006, ought to have been considered prior to resorting to recovering proceedings under the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. However, the High Court said that the benefit of the RBI's notification and its interpretation by the apex court in the case of Pro Knits vs. Board of Directors of Canara Bank would not be available to the petitioner-firm as it was already closed when the bank resorted to recovery proceedings as stipulated in the 2015 notification of the RBI. The court also pointed out that during the pendency of its petition, the petitioner-firm communicated to the bank indicating that it had wound up the business and closed the operation two years ago. 'If the firm has wound up the business and closed the operations two years ago, it cannot take the benefit of the firm being a MSME and the notifications issued under the MSMED Act or even the judgement of the apex court in Pro Knits case,' the court said.
