New Delhi, August 30: The Reserve Bank of India (RBI) has rejected the move by Bank of Baroda (BOB) to send Anil Ambani group companies — Reliance Home Finance Ltd (RHFL) and Reliance Commercial Finance Ltd (RCFL) to the National Company Law Tribunal (NCLT) for debt resolution under Section 227 of the IBC.
According to a source, RBI is satisfied with the progress made by the lenders and by both companies towards successful resolution under its June 7 circular of last year, Business Standard reported.
BoB is the lead consortium of both companies and had sought RBI’s permission in May this year asking the regulator to send the company to the NCLT. Section 227 of the IBC gives special power to RBI and the Union government for referring financial services companies to the NCLT for debt resolution.
BoB informed the rest of the lenders on Thursday about RBI’s rejection of its application.
The RBI rejection is a second blow to BoB – the lead bank of both companies — after a Delhi High Court order on August 18 stayed a move by BoB and the entire consortium of lenders to classify these accounts as fraud, restraining them from taking any other coercive action till the next hearing.