According to Section 2 (j) of the Limitation Act, 1963, the life of a loan document (DPN) is three years. Once the original Demand Promissory Note (DPN) is expired then the bank will not be able to enforce money suit to recover its due through Court of Law. If the loan is secured by the…
Any contract that is executed by an executant without for any consideration is void in the eyes of law. As per section 25 (3) of the Contract Act, a fresh promise made for repaying the time barred debt is a valid consideration and the same is enforceable in a court of law. Therefore, it is…
(This post elucidates details of timelines for implementation of Resolution Plan (RP) and insolvency application to be filed by the lenders if a RP is not implemented as per the timeline.) In terms of RBI circular dated February 12, 2018, the ‘Resolution Plans’ (RP) under IBC shall be implemented within the timeline given below in…
The Reserve Bank of India on Monday (12.02.2018) scrapped all existing frameworks for revitalizing distressed assets such as Corporate Debt Restructuring (CDR) scheme , Flexible restructuring of long-term project loans(5/25) scheme, Strategic Debt Restructuring (SDR) scheme, Scheme for Sustainable Structuring of Stressed Assets(S4A). The Joint Lendes’ Foroum (JLF) as an institutional mechanism for resolution of…
The Reserve Bank of India on Febraury 7, 2018 vide its circular DBR.No.BP.BC.100/21.04.048/2017-18, given an instrucion to banks and NBFCs not to down grade the asset classification of accounts of MSME borrowers where the borrower’s account was standard as on August 31, 2017.The accounts shall be treated as standard accounts if the borrower unit is…
The Insolvency and Bankruptcy Code (IBC) 2016 is the bankruptcy law of India, amended as Insolvency and bankruptcy code (amendment) Bill 2017. The new law seeks to consolidate the existing framework by creating a single law for insolvency and bankruptcy. The mounting NPAs in the banking sector and other financial institutions have crippled lending activities…
Both the houses of the Parliament have passed the Insolvency and Bankruptcy Code (Amendment) Bill 2017 and the bill is waiting for assent of the President of India to become a law. The aim of this amendment was to tightening loopholes in existing code and disallows backdoor entry of some existing managements from bidding as…
(This article explains the meaning of contract of Indemnity; features of Indemnity Contract, rights and duties of indemnity holder.) Definition of contract of indemnity: Section 124 of contract Acts defines contract of indemnity as “a contract by which one party promises to save the other from loss caused to him by the conduct of the…
Registration of a partnership firm is not compulsory under law. However, the registration gives the firm a legal status. Section 69 makes claims arising out of a contract unenforceable if the firm is unregistered at the date of the institution of the suit. Thus, the major drawback of the non-registered partnership firm is that it…
Registration of a partnership firm is not compulsory under law. It is left to the partners of the firm to register their firm or not. However,the advantages of registration of a partnership firm are that the registered firm offers an irrefutable legal proof of the existence partnership and the composition of partners, their address,…