Lok Sabha is scheduled to discuss legislative business for Monday. The Enforcement of Security Interest, Recovery of Debts Laws and Miscellaneous Provisions (Amendment) Bill, 2016 will be the center of talk.
As Reported by Joint Committee is listed for consideration and passing, the bill which introduced in May, seeks to amend four legislations.
Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act (2002), the Recovery of Debts due to Banks and Financial Institutions Act (1993), the Indian Stamp Act (1899) and the Depositories Act (1996).
The government has come up with this legislation at a time when there is mounting concerns over loan recovery in view of stressed assets to the tune of over Rs 8 lakh crore in the banking system.
The legislation proposes to give the RBI powers to regulate asset reconstruction companies, priorities secured creditors in repayment of debts and provide stamp duty exemption on loans assigned by banks and financial institutions to asset reconstruction firms.
Around 70,000 cases involving more than Rs 5 lakh crore are pending in Debt Recovery Tribunals (DRT) and the proposed amendments would facilitate expeditious disposal of recovery applications.