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Corporate Affairs Ministry Mulling Setting of Threshold for Homebuyers for Starting Insolvency Proceedings

In the last three years 21,000 cases have come to IBC, out of which nearly 10,000 cases have been settled

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There is a feedback from housing and urban affairs ministry and other quarters like real estate industry that this has to be looked at, and some threshold approached has to be followed. Pixabay

In a move to limit the abuse of the Insolvency and Bankruptcy Code (IBC), the Corporate Affairs Ministry is mulling the setting of a threshold for homebuyers for starting insolvency proceedings against real estate developers, Corporate Affair Secretary Injeti Srinivas said on Monday.

Speaking to reporters, Srinivas said the ministry is also looking at a distribution formula for financial and operational creditors to create a hybrid system of auction of properties with a rigorous examination of resolution applicants to make the system more transparent and legal hassle free.

“If a single homebuyer is the (insolvency) trigger because the Rs one lakh threshold has crossed, one day default has crossed..otherwise a well-functioning company comes to NCLT (National Company Law Tribunal, it is not a happy situation,” he said.

“There is a feedback from housing and urban affairs ministry and other quarters like real estate industry that this has to be looked at, and some threshold approached has to be followed. In the last three years 21,000 cases have come to IBC, out of which nearly 10,000 cases have been settled. 8,500 cases prior to admission and about 1,500 cases resolved and over 1,500 cases are ongoing. The whole issue of system getting clogged.

Corporate, Ministry, Homebuyers
Speaking to reporters, Srinivas said the ministry is also looking at a distribution formula for financial and operational creditors to create a hybrid system of auction of properties with a rigorous examination. Pixabay

“These are real issues but the typical approach which will be beneficial is that cases that involve large outstanding and where IBC is the best option should actually take recourse to IBC. Things which are not having smaller outstanding can be better settled outside IBC. IBC is a rigorous process with lot of phases” ,” he added.

The Secretary was briefing reporters here following a meeting between Finance Minister Nirmala Sitharaman with bankers on IBC issues.

The meeting, at which he was present, also discussed the treatment of operational creditors under the IBC which has been a bone of contention.

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“The possibility of formula-based distribution (of assets) which is fairly elaborate which can give best option and reduce litigation and reduce time for litigation with (section) 29A getting settled beyond doubt, the only litigation area essentially is who gets how much, if that can be resolved in an effective manner that could be the real thing”, he said.

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He also said the government is considering ways to to make the IBC process more transparent and less litigation prone

“Right now, there and both financial and non-financial considerations. The non-financial considerations determine the eligibility and the financial considerations determine the outcome of the bids. So, there is a feeling that the non-financial considerations can be use for shortlisting and then for the bidding we can have auction mode,” he said.

“There could be possibilities that we would examine to make it more transparent and less litigation prone, whether we can have a hybrid system where we can have the rigorous examination of resolution applicants’s eligibility in one stage and after we shortlist all eligibles can there be an auction platform where they actually bid..that can increase confidence in the system,” he added.

Billionaire L.N. Mittal-owned ArcelorMittal had last year won a long-drawn auction for Essar Steel but still has not been able to take over the company. While the NCLT approved ArcelorMittal’s bid in March, some operational creditors and British lender Standard Chartered have filed appeals in higher courts.

Corporate, Ministry, Homebuyers
If a single homebuyer is the (insolvency) trigger because the Rs one lakh threshold has crossed, one day default has crossed..otherwise a well-functioning company comes to NCLT (National Company Law Tribunal, it is not a happy situation. Pixabay

Essar Steel is saddled with debt of more than Rs 50,000 crore. As per ArcelorMittal’s proposal, financial creditors would receive Rs 41,987 crore against their admitted claims of Rs 49,395 crore. Operational creditors were to get Rs 214 crore initially but this was increased to Rs 1,214 crore later.

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Standard Chartered would get only Rs 60 crore against its claim of Rs 3,487 crore. Standard Chartered and the operational creditors have submitted that the financial creditors, that is banks such as State Bank of India and Edelweiss Asset Reconstruction Company, will receive almost 90-92 per cent of their dues. (IANS)

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Here are Some Essentials for your Corporate Wardrobe

Your nine-to-dine corporate clothing guide

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Corporate Wardorbe
Before you start shopping for your corporate wardrobe, there are some essentials you need to keep in mind. Pixabay

Nothing screams business better than a crisp suit, but for women, even workwear options are aplenty. Before you start shopping for your corporate wardrobe, there are some essentials you need to keep in mind.

“It is essential to dress appropriately at the workplace for an everlasting impression because individuals who dress shabbily are never taken seriously at work. It goes without saying that one should avoid wearing jeans, capris, shorts, T-shirts or short dresses to work. Make sure you feel comfortable in whatever you wear and follow a professional dress code. It is not always necessary to wear expensive clothes rather wear something which looks good on you,” suggests Meha Bhargava, Founder Styl.inc.

As per Meha, these are some basic essentials to have in your wardrobe while working in any corporate environment:

Power Suit

A nicely cut suit is always a must. Be it skirts or pants, depending on your company’s code of conduct, it needs to be crisp and sharp enough to make you look like the authority figure. And adding a slim/block heels never hurts.

Corporate Wardorbe
Always have that trusted blazer in your wardrobe you could pull out in case of emergencies. Pixabay

Blazer

Always have that trusted blazer you could pull out in case of emergencies. A checked blazer will turn almost every outfit formal.

Basics colors

Always have basic black/blue/grey trousers and some pastel and solid dark shade tops in your wardrobe. Even black/blue and white combinations can be life-savers.

Checked or printed pants

When you want to try something different yet simple, go for checked pants with a solid colour top or sweater. Adding a nice pair of solid colour sandals or shoes enhances the whole look.

High-waisted pencil skirts

This is the kind of trend which has been carried forward since the 70s. A shirt and a nicely cut high-waist pencil skirt have been a staple. When in doubt, go back to the basics.

Denim with formal shirt and blazer

For those “Casual Fridays” when you want to keep it light yet professional. A semi-formal shirt, jeans and casual shoes are never off the mark.

Corporate Wardorbe
The type of shoes you wear can make or break the look. Pixabay

Layering with pants

Just add a simple coloured cardigan/scarf over your shirt and pants to elevate your look.

Jewellery

In case of accessories in the workplace, it is nice to keep effortless and simple. What can be a part of your ensemble — a handbag, a delicate chain with a small pendant, a watch, delicate earrings.

Shoes

The type of shoes you wear can make or break the look. Experiment with the type of heels. Sometimes, a basic outfit can be uplifted with a pair of coloured heels. For the days you know you have meetings and you have to be on your feet, go for either loafers or low-heeled wedges. For other days wedges and block heels are your best friends. For office parties keep a trendy pair like alligator pumps or animal print to add to your style.

Harshita Gupta Founder, Hail Women says that formals are a fashion statement in itself, and has these tips for when you shop for corporate wear.

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Understand your body type

The Indian body type is far curvier than other countries, and it can be tough for many women to fit in standard size chart. To ensure your workwear is comfortable and easy-to-go in all settings, pick your perfect size by making it custom fit. (IANS)