TIL Desk/Business/New Delhi/ Assuring balance-sheet stressed firms that key objective of NPA resolution is not liquidation of their businesses but to save them, Finance Minister Arun Jaitley today said, the new insolvency law has significantly reversed defaulting debtor-creditor relationship.
“The ultimate objective really is not liquidation of assets, (but) to save these businesses, get either the existing promoters with or without new partners or new entrepreneurs to come in and make sure that these valuable assets are preserved,” Jaitley said.
He was addressing an insolvency summit organised by industry lobby Confederation of Indian Industry (CII) here. Explaining the rationale for the new insolvency and bankruptcy code (IBC), he said, this was necessitated by the failure of debt recovery tribunals to effectively perform their duty after the initial success.
When enacted, the Sarfaesi (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) Act had succeeded in getting down NPAs drastically in the initial two-three years, Jaitley said.
