DFS Secy urges state-run banks to fast-track pending IBC cases, tighten monitoring at NCLT

India’s finance ministry on Tuesday directed state-run banks to step up monitoring and accelerate the admission and resolution of pending bankruptcy cases at the National Company Law Tribunal (NCLT), warning that delays were slowing the corporate insolvency process.

M. Nagaraju, Secretary in the Department of Financial Services (DFS), reviewed the status of cases under the Insolvency and Bankruptcy Code (IBC) with senior officials from the ministry, the Insolvency and Bankruptcy Board of India and chief executives of public-sector banks (PSBs), the ministry said in a statement.

The meeting examined cases admitted and resolved at NCLT as well as those settled outside the IBC. Nagaraju said strict adherence to timelines for admitting corporate insolvency resolution process (CIRP) applications and completing resolutions was essential to strengthen the framework.

Banks were told to coordinate more closely on accounts where resolution plans are pending with the Committee of Creditors (CoC) and to pursue early admission of cases through their legal counsel to ensure quicker recoveries.

Lenders were also advised to minimise delays in filing CIRP applications and to comply with an Insolvency and Bankruptcy Board of India circular issued on Nov. 4 requiring resolution professionals to submit undertakings before a special court under the anti-money laundering law for restitution of assets attached by the Enforcement Directorate.

The ministry said collaboration among all stakeholders needed to be streamlined to prevent procedural delays at NCLT benches.

Chief executives of PSBs were asked to personally monitor their top 20 cases pending for admission and top 10 cases awaiting resolution and to take swift action on accounts where plans are awaiting CoC approval.

Nagaraju urged banks to adopt a more strategic approach to strengthen the IBC ecosystem, improve value realisation and enhance recoveries.