A bitter sweet tale

If someone were to ask, how and when it started,

He would probably not know the answer.

She crossed him as one among many,

But as days passed by and he knew her more,

She drew in him a spark of inquisitiveness like none other.

He wanted to know her; explore the woman she was,

And he would probe her image to find out more.

Sometimes, getting confused if she was all alone,

Sometimes having the realization, she was not after all.

And as days passed by and his romance grew louder in his heart,

Out of the blue, they came across wanting each other,

Like it was all waiting to happen.

It was nothing but a wild dream come true,

For she was a beautiful princess in a dane’s world.

He took it all very casually, for he was a fool,

Believing that he deserved her all this while,

And that she had nothing but him.

Maybe, he was so happy in her thoughts,

He never realized his sad destiny.

Things started slipping away and she was gone from his life,

She went away without a reason he could ever understand.

He tried hard, fighting with himself as to what went wrong,

As he could not let go of those beautiful memories,

And all those dreams he painted for them together.

He thought and thought for months and years,

As to what he could have done right to have her stay,

But every time she would not care less.

He could never tell her his feelings,

That he could feel her eyes, lips and breadth with his eyes wide open,

That he could never tell her that her smell was all that made his day.

He could never tell her that even when she was a million miles away,

He could feel her as if she was right next door,

And he was ready to be with her whenever she called.

He wanted to be with her all the time,

Watch her sleep, caress her hair and smile in the wilderness,

If only he knew what it would take for her to love him back,

As he loved her in his thoughts when she was away!   

Committee of Creditors: An Institution of Public Trust

“Committee of Creditors” (CoC) is a committee consisting of the financial creditors of a Corporate Debtor. This Committee eventually becomes the decision making body for the various routine tasks involved in Corporate Insolvency Resolution Process (CIRP), responsible for giving approval to the IRP/ RP to carry out actions that might affect the outcome of the CIRP.

Insolvency & Bankruptcy Code is a welcoming legislation, which has brought about a positive perspective of improving credit culture in India by creating a 'creditor driven regime' and the role played by the CoC in achieving the same is noteworthy.

While deliberating upon who should form part of the CoC, the Bankruptcy Law Reforms Committee (BLRC) report states as under:

“Members of the creditors committee have to be creditors both with the capability to assess viability, as well as to be willing to modify terms of existing liabilities in negotiations. The Committee (BLRC) concluded that, for the process to be rapid and efficient, the Code will provide that the creditors committee should be restricted to only the financial creditors”.

Further, in the landmark Judgment of Swiss Ribbons vs. Union of India, the Hon’ble Supreme Court of India has observed “Since the financial creditors are in the business of money lending, banks and financial institutions are best equipped to assess viability and feasibility of the business of the corporate debtor. Even at the time of granting loans, these banks and financial institutions undertake a detailed market study which includes a techno-economic valuation, evaluation of business, financial projection, etc. Since this detailed study has already been undertaken before sanctioning a loan, and since financial creditors have trained employees to assess viability and feasibility, they are in a good position to evaluate the contents of a resolution plan.”

The importance vested in the CoC under the Code has again and again been reiterated by various Tribunals/ Courts, most notably among all by the Hon’ble Supreme Court of India in the matter of K. Shashidhar Vs. India Overseas Bank & Ors wherein the apex court addressed a critical issue in the CIRP i.e. the scope of judicial scrutiny over a commercial decision taken by the committee of creditors. This decision has put this issue beyond doubt that the commercial decision of the CoC is non-justiciable and will not be open to scrutiny by the NCLT.

It is clear from the above observation made by the highest Court of India that the Code has entrusted the CoC, which primarily comprises of financial creditors with the responsibility of driving the CIRP and taking informed decisions on behalf of all other stakeholders so that the debtor can be resolved as a going concern.

The economic value created by the Corporate Debtor undergoing CIRP has immense importance in terms of value of its core assets, employment generating capacity etc which adds to the overall development of the economy both financially and socially. Due to such inherent values, it becomes imperative that the responsibility entrusted to bring about a positive resolution & preservation of such assets in distress is entrusted to a responsible class of creditors being the CoC.

Therefore, it is incumbent upon the CoC that while performing their responsibility of overseeing the CIR process, the members of the CoC act in the interest of all the stakeholders and do not treat the CIR process as a mere sale, auction or recovery process. This will emanate in retaining the debtor in default as a going concern which is the primary objective of the Code. This will also result in value maximization as the entity will be worth more as a going concern rather than a concern which is not in operation.

In light of the above, it becomes all the more important for the members of the CoC to continuously update themselves about the dynamic business environment and the ever changing laws and regulations relating of insolvency framework in India. The members should come fully prepared with all the matters put forward for discussion during a CoC meeting so that a meaning deliberation is possible thereby resulting in a time bound resolution which is the ultimate objective of the Code.

In my experience, one of the major challenges threatening the IBC’s objective of time bound resolution of stressed assets has been the long dwelling litigations. While the CIRP of various accounts have been held up at various stages, few reasons which may be in the control of the CoC and which may translate into speedier resolution include transparency in decision making during CIRP, clearly defined and transparent process document and stressing on a well laid out resolution plan clearly spelling out steps for implementation of resolution plan post approval.

As a responsible member of the CoC, members should strive to achieve the maximum degree of transparency in the CIR process and such actions should be clearly noted by way of a well drafted process document which will help in avoiding unwanted litigations.

We have witnessed several large cases of corporate insolvencies failing to get implemented due to the inability of resolution applicants in actually implementing their respective resolution plans. While, the resolution applicants are to blame for not honoring their commitment, a healthy share of the blame also rests with the CoC which did not foresee the eminent risk which was the result of lack of proper due diligence on the resolution applicant and an effective viability and feasibility study on the resolution plans including assessment of the financial strength of the applicant.

A well thought out process document with adequate safeguards including securities like upfront performance guarantee of an amount commensurate with the bid size would have served well in realizing successful resolutions.

One other very important aspect for consideration by the CoC is to analyze the reasons why the Debtor in default was pushed for insolvency resolution and help bring to light the elements which were responsible for the downfall of the entity. This is important as every penny invested by the financial institutions is public money and such entities including the financial institutions have a greater responsibility to add value to such public resources.

In this regard, the outcome of transaction audit carried out under the code becomes a very important document which should not be written off just as a tame requirement of the Code and something which is only the responsibility of the Resolution Professional. Rather, the CoC as a representative of the public at large should invest considerable time and effort to analyze the report and persuade the Resolution Professional for to make a comprehensive application to the Adjudicating Authority covering for reversal of all such transactions which has eroded the value of the Corporate Debtor and eventually eroded the value of the enterprise as a going concern.   

As the Code is relatively new, it is witnessing a plethora of changes in the form of amendments which are driven by the experience of its stakeholders including the Govt., IBBI, Tribunals, Insolvency Professionals & Creditors at large at implementing the Code. Going forward, we should anticipate further changes in the Code to incorporate provision for group insolvency, cross border insolvency, Pre packs and charting the way for individual insolvency. We should strive to keep ourselves abreast with these changes so that we can anticipate resolution strategies in advance and be able to make informed decisions.

Beauty in Red

Through my shades I see a glimpse of her,

Smooth across me in her sexy red gown,

Glittery silver rings around her cape,

Chiseled and carved by the finest craftsman,

I adored her without a blink!

As if she noticed my admiration,

She paused, stood right next to me,

Our eyes locked!

And then with a twinkle, she walked past me,

Making me turn and gaze as she disappeared,

Her image still so vivid,

I stood there endlessly delving into her thought!

Under that Veil

It is that mystery, they all want to hold;

Far away beyond lies it, they all want to caress their soul.

The light just walks away, remaining yet unknown!

Sometimes out of the blue, it appears so close;

Bringing hope and joy to their soul.

The very next moment despair creeps in,

Into a yet another melancholy chore!

Not known to the poor soul,

The cycle just moves on to haunt then some more.

Their platonic love is but unknown!

Under that veil they realize, it is all but momentary;

And a time comes, they feel no more.

The veil, they cannot ever come out of alone,

And forever they continue to live loving from a distance and wanting no more!!

Promise

It used to be beautiful & bright,

The first ray of sunlight,

Falling through the dancing leaves,

Like gleaming snowflakes,

Filtered through the scent of nature!

The birds would be chirruping,

Dancing, jumping and playing with one another,

Some playing the violin,

Some singing over the piano,

While some resting under the warm sunlight,

Waiting for the angels from the skies!

With the skies marred with dark clouds,

The promise of such days have eluded for long days and nights,

Leaving behind only the bitter cold,

And the dullness of the skies!

But there still was a promise,

As the soul was always faithful,

As it would want to bath again,

Under the warmth of the sun lit day,

And dance again in the melody,

Of the chirruping birds long swept away!

So it survived, hoping the angels would descend indeed,

From the heavens above!!

And one fine day, the skies opened,

And shed tears for the dismayed soul.

The tears washed all the gloom away,

And made way for the promise of a new day!

Even if it were miles away,

The one tiny light seen through the grey, Made my day!!

In search of the Perfect Sambhar Rice!

Almost seven months are past since that day I left,

There was no joy nor any sorrow either.

It was a ride to the southern lands that got me excited,

None there was in leaving the northern plains!

Then I wondered what lay there in the southern lands,

That I do not have in the north?

And then I wondered and it came to my probing mind,

What would it be like to have the perfect sambhar rice!

So I came here all excited one fine morning.

My friends greeted me with joy and fanfare.

And when all the excitement had settled down,

I quietly went out to the nearest inn,

And ordered the Sambhar rice.

Bingo, it was what I had never imagined,

That perfect sambhar rice served on the banana leaf,

Half full with rice and the other with the sambhar,

Full of radish, carrot and green,

The sambhar looked like nothing I had at any northern inn!

And so I thought what a place this is,

I will live like a king and eat like a queen!

But as days passed by, the things dint change.

The sambhar remained the same,

The rice and the banana leaf dint change!

So I went out one day looking for a change,

But O dear, what a change it was,

The roti was dreadful, the curry worst of all!

So I thought to move away to a place better they say,

It was called Bengaluru at some distance from the bay.

Again my friends greeted me with fanfare,

And threw a party upon my stay!

I swear to the almighty, it was the best day of my tragic foray,

The promise of sambhar rice had brought with it all but dismay!

The change was now not constant,

As it came in a different costume every day.

The sambhar may have remained the same,

But it all changed for me that fine day!

Into The Wild

My normal day begins with the phone alarm ringing and shaking the soul out of me and ends with the same exercise at night for the next day. I wake up unceremoniously without any emotion and carry the same passiveness and coldness while I dress up and leave for office. Everything is well documented in my mind. The time I devote to bath myself; the way I dress; the particular metro rail I board are all timed to perfection. Any irregularity may cost me dear as I may end up missing my office shuttle waiting at the other end of the city! And if I thought that I was the only individual to have embraced this lifestyle then I am wronged everyday upon meeting people who are equally passive and ‘perfect’ in the modern day context. Even in the Metro rails considered the ‘lifeline’ of Delhi, there is hardly any life. The old buses with open windows and a touch of fresh air brought in more romance to life than the comfort rich moving boxes better known to us as the Metro. Inside the metro the scene is gloomy and dull. People are either sitting with their eyes closed or are hanging sleepy like zombies from the hand supports on the ceiling. The rest are habitually plugged in to their head sets. The haunting silence is only broken by the screeching noise of the tracks, the monophonic tone of the computerized announcements at every station and the clicking of the automated doors. People come in & come out of the Metro rail as if ready to work robots are being rolled in & out of the assembly units in batches one after the other. The rails come & go throwing out human machines pre-programmed to follow a certain path to their work places. In the helter-skelter of the wee hour I am lost among the millions and find myself sitting ideal all alone, unnoticed by the crowd passing around me. And finally when my station arrives my mind projects me in an unknown land trying to figure out what is going around me! I run with all my breadth and pace to be the first to exit the metro gates or end up being the hundredth gentleman in the queue! The morning hours in the ‘Cyber city’ seems like a visit to the Chernobyl post its nuclear tragedy with a lull and stillness of the morning mist; the dullness of the monolith structures under the still sleeping sun; when even the green and lively tress are fast asleep. But again who cares about the trees and for that matter if they are sleeping! The trees keep on cursing the polluting machines and the machines keep on mocking and honking their handicap brothers! The world moves around so fast that if I recall it at my leisure, i come to the realization that our lives have become so messed-up in our own systematic ways that it is hard to comprehend a life otherwise; free from the daily chaos and the modern wisdom. In the quest to perfection we have relinquished the motherly touch of nature and embraced a system which de-voids us of any vision and life beyond material success. Ironically, today one has to search for life in a torch light; albeit it is near impossible to find one in broad day light!