The Bhushan Power & Steel (BPSL & # 39; s) property, run by Hay & # 39; s Enforcement (Ed), has warned creditors against adopting the & # 39; Insolvency and Bankbankation Code (IBC) & # 39; 39; for solving debt.
"As a bank, we are all concerned about the involvement of the PMBC's Money Laundering Act (PMLA). It would have been difficult to reach # 39; IBC and this would disrupt the whole process. In a few cases, Ashok Kumar Pradhan, the manager, chief executive and chief executive officer of the Bank of India (UBI), Ashok Kumar Pradhan, said.
The Annex issued by the ED was made in accordance with the PMLA Act and is currently being tried by the National Court of Appeals (NCLAT). On Friday, NCLAT asked the ED and the Ministry of Corporate Affairs (MCA) to reach a consensus on the matter. ED is an agency & # 39; ad under the ministry of finance and MCA is trusted to manage the IBC.
The head of the public sector bank said if the PMLA is tried by the IBC, about 90 percent of NPA cases in the banking system will be fraudulent. "This means that there will be no solution in the IBC system," he said.
Most IBC cases face investigations under the PMLA. In addition, the ED, said in the BPSL case, that jurisdictional courts do not have the authority to release assets directly under the PMLA.
With two laws shutting down corners, a senior official of the State Bank of India said the government should change the IBC, if needed.
Suharsh Sinha, Partner, AZB & Partners, said, there is considerable concern among buyers and lenders about the merger of assets under PMLA.
"At the same time a buyer enters a company blindly and additional debts may arise even after the NCLT approval. This can create a ground for competitors to withdraw or review contracts. A consultation process is required between ED and MCA. "
Vidisha Krishan, a partner, M V Kini & Co, said, it would be better if the Supreme Court could clearly distinguish when PMLA could come, if the companies were resolved.
"Time has expired in the case of Bhushan Power & Steel. While PMLA is a criminal offense and any property created by the criminal act should not be allowed on a basis, resolution or one-time agreement under IBC, Time "It is important. ED should not come in at the last minute and attach property. This is important otherwise any process at the final stage will be unlocked and put out by competitors," she pointed out.
Krishan also said that the correction could be more NoC than PMLA than NCLT's approval of the resolution.
Sinha however says all resolution plans have provisions that their attachment will be covered.
The dispute about the PMLA and the IBC has resulted in extreme insults.
But Sudipta Routh, Partner, IndusLaw, points out that the simplest rule of interpretation of the law in the two conflicting laws is that the latter law should get priority, even if that is the date of the last amendment.
"The PMLA was amended in August of 2019 by the controversial teeth created by three separate factions (PMLA Appellate Tribunal, Delhi High Court and NCLAT). Unfortunately, these amendments do not seem to resolve the dispute between the IBC and the PMLA. "To come out of this is a PMLAT order. Apply it to the Occam machine, and it will be the IBC that will have the priority, until the council decides to change it," he said.