RBI moves NCLT to initiate insolvency proceeding against Srei Infrastructure & Srei Equipment Finance

The Reserve Bank of India on October 8 filed applications for initiation of corporate insolvency resolution process against Srei Infrastructure Finance Limited and Srei Equipment Finance Limited under the Insolvency and Bankruptcy Code 2016, at the Kolkata Bench of the  National Company Law Tribunal (NCLT), the central bank said in a release.

The Kolkata-bench of NCLT has admitted RBI's applications to initiate IBC proceedings against SREI Infrastructure Finance and SREI Equipment Finance.

The central bank in the release said, according to Insolvency Rules, an interim moratorium shall commence on and from the date of filing of the application till its admission or rejection.

The interim moratorium will be declared by NCLT which prohibits legal action against the companies and transfer or disposing off assets by the companies.

Earlier in the day, Moneycontrol had reported that RBI has moved National Company Law Tribunal (NCLT) to initiate the insolvency proceedings against SREI group firms.

Bombay High Court on October 7 had dismissed SREI Group's plea against the RBI's takeover and appointment of administrator at Srei Infrastructure Finance Ltd and Srei Equipment Finance Ltd.

Adisri commercial private limited, (Srei Group Promoters) had filed a writ petition against RBI and sought a stay on initiating insolvency proceedings against the NBFCs.

On October 4, the RBI had superseded the board of the two NBFCs citing concerns around governance and defaults on dues.