It is wrong to say that rise in bad debt only because of corruption and the power companies should utilise the time allowed by the Supreme Court, said HR Khan, former deputy governor of RBI.
In a relief to beleaguered debt-ridden companies, the Supreme Court on Tuesday transferred all pleas filed before different high courts to itself in power NPAs case.
It also ordered a status quo on all cases under the Reserve Bank of India's February 12 circular. The apex court will now hear the cases in November.
The process will not be stalled because the process of resolving the large number of NPAs has to go forward, said AK Purwar, an industry expert. However, he said the SC must have had some valid reason for the decision.
It is a sort of a temporary stay of the action under the RBI circular but it is an effort to work out some resolution schemes for the purpose of these projects, said Umarji, former chief legal advisor, Indian Banks' Association (IBA).