Mumbai: The auditor appointment rules specified by the Companies Act has led to different interpretations. At least 10 publicly traded companies have violated these norms by hiring auditors for terms of less than five years, proxy advisory firm Stakeholder Empowerment Services (SES) said in a report. 

“In current year till now SES has sampled more than 10 companies which have proposed resolution for appointment of auditors for a term of less than five years, which in opinion of SES is blatant violation of law. SES makes it clear that it is only a representative sample, there could be many more cases like this,” the report said. 

According to the Companies Act 2013, an auditor has to be hired for a fixed term of five years and can be reappointed for another term of five years. It further states that this appointment has to be ratified at the annual general meeting (AGM) of shareholders. 

After these norms were notified, companies were given a transition period of three years to adapt to the new rules, which ended in 2016. 

The companies mentioned in the SES report have proposed to appoint auditors for tenures of less than five years. 

For instance, L&T Technology, one of the firms named in the SES report, has proposed appointing an auditor for just a year. 

In an emailed response, the company said, “In view of change in auditors at a group level, it was decided by the board to appoint statutory auditors for a period of one year. The said appointment of auditors would be ratified every year by the shareholders.” 

Another company mentioned in the report is AkzoNobel which is appointing statutory auditor for one year. 

“The law prescribes that the auditor be appointed for a period of five years—with a caveat that the same should be ratified each year at the AGM. De facto, it becomes an annual re-appointment. The present auditors…have been appointed in the 2016 Annual General Meeting. AkzoNobel India intends to continue their appointment for such tenure as required under the Companies Act,” a spokesperson for the firm said in an emailed response. 

“With so many companies compliant with the law, one cannot certainly hide behind complexity of the law. Therefore, it is an attitude of having scant regard for law and its compliance and failure of system to punish non-compliance,” said J.N. Gupta, managing director and co-founder of SES. 

Most of the companies who responded to Mint’s emails seeking comments are reading the five-year appointment clause to mean a maximum of five or 10-year term (since audit firms can be re-appointed once). 

Since our auditors have already served for eight years, we cannot appoint them for more than two years, said Kapil Bagla, director and chief executive officer at Adlabs Entertainment Ltd, another firm named in the report. 

Similarly, Quess Corp. said since its auditors have completed nine years, “appointment of the auditors for a term of five years would result in violation of Section 139 (2) of the Companies Act, 2013. This implies that the incumbent could have been appointed only for an additional period of one year and not five years.” 

“There is no scope for creative interpretation, the section is abundantly clear that word used is ‘shall’ as opposed to ‘may’, which makes it a mandatory compliance requirement that an auditor firm has to be appointed for five years and can be reappointed for another term of five years,” said Ananth Subramanian, practising company secretary and former president, Institute of Company Secretaries of India (ICSI). 

It would be “incorrect and misleading” to say that our appointment of statutory auditors for three years “is not in line” with the Companies Act,” said P.K. Rustagi, vice-president (legal) and company secretary, JK Tyre & Industries Ltd.

“If the intention of the legislation was to have minimum five-year term for auditors then, where was the need for the shareholders to ratify the appointment on annual basis?” 

Punjab Housing Finance, another of the firms named in the SES report, declined to comment.

Bombay Dyeing, Uttam Galva, Wimplast (which has now withdrawn the auditor proposal) and NRB bearings did not respond despite repeated email reminders. 

According to the Companies Act, non-compliance can lead to a fine of maximum Rs5 lakh and for the individual officers can lead to a jail term and fine of up to Rs1 lakh.

Go to Source

Mining investment advisory company MX Mining Capital Advisors and law firm Norton Rose Fulbright South Africa are collaborating to assist in raising about $500-million in finance for mining projects worldwide and for Africa-based projects in particular.

MX Mining is focused on raising capital and working with investors and emerging and established mining firms to advance projects. However, MX Mining director Dr Mike Seeger tells Mining Weekly that he realised in 2016 that there was a need to strengthen his team and approached Norton Rose to assist with the legal technical components relating to mining finance, as well as to leverage the firm’s relationship with government departments and senior investors, owing to its vast experience in mining finance deals worldwide.

Seeger says that the way a project is structured is critical to ensuring whether or not it receives the required finance, which is why Norton Rose’s involvement in this initiative is so crucial.

He emphasises that the current financing climate for miners is very challenging, which is why there is a need to find innovative ways to raise money for mining projects.

These include sourcing finance from traders through offtake finance agreements; finance for engineering, procurement and construction from mining and processing contractors; insurance-backed debt financing from insurers partnering with banks; equipment finance from mining equipment suppliers for the mining projects they supply; reverse listings; offtake finance; streaming and royalty finance; and corporate bond finance.

Norton Rose Africa head Gregory Nott notes that, through the firm’s worldwide presence, it is able to track the latest funding trends and processes to assist miners in raising capital for their projects throughout the development timeline.

“We also leverage off MX Mining’s and Norton Roses’ international relationships to provide technical and legal guidance and assistance for companies in a mining-consultancy- type fashion that provides meaningful support for our clients,” he highlights.

Seeger comments that companies are generally seeking finance ranging from $2-million to $160-million. He elaborates that they often assist companies in re-engineering large-scale projects into smaller-scale ones that are simpler to fundraise for.

For example, MX Mining is working with a titanium and vanadium project in South Africa, which was originally intended as a large iron-ore project. However, owing to constraints in raising funds for large-scale new iron-ore projects, the project was re-engineered to focus on the mining and processing of high-grade titanium seams on a smaller scale. A funding term sheet for the project is currently being finalised.

“We are therefore providing a uniquely comprehensive financing and technical assistance offering,” highlights Nott.

Seeger remarks that companies firstly need to provide a strong business case to raise money, including having all the required exploration and/or mining permits, scientific data on their prospects, solid mine plans that take into account existing infrastructure (including access to water and power) and ties to sustainable markets, as well as strong management teams that can drive the projects efficiently.

The economics of a project is just as important – including capital expenditure, operational costs, payback timeframes and calculated revenue streams.

On average, MX Mining seeks to have projects with an internal rate of return (IRR) of between 19% and 25%, which varies according to the commodity being mined. Seeger points out that, if the IRR is above 45%, the company is sceptical, as these tend to be highly inflated projections and, if it is below 20%, the company becomes concerned, owing to the low return margins, and may reject the project on this basis.

“We have to be very careful not to encourage speculators, as it is genuine project developers that we want to assist,” Seeger states. He highlights that there is a lot of hesitancy in the investment community, owing to the large number of projects for which capital could be raised but were never developed.

MX Mining and Norton Rose are able to offer support across the full spectrum of project development from early-stage greenfield exploration to mine development, mine plan redesign and the expansion of existing operations.

Nott says the firm makes use of its banking and finance and mining teams to design tailor-made funding models to support a project, depending on where it is on the development timeline.

Seeger observes that, across the board, commodity prices are steadily improving. There is also a focus on different types of commodities as the Fourth Industrial Revolution dawns. These include vanadium, titanium and lithium (owing to their use in renewable and other green energies), while traditional commodities, such as gold, manganese and chrome, remain important.

Further, he highlights that phosphates and potash are also commodities attracting a lot of attention from investors, owing to their importance in food production.

However, Seeger points out that coal miners are facing “severe challenges” in raising the capital they require, as coal is not viewed as an attractive investment proposition for many traditional investors, owing to the growing number of global initiatives aimed at reducing carbon emissions, such as the United Nations Framework Convention on Climate Change, and a general increase in hostility towards the mineral resource being demonstrated by environmental lobbyists and activists. This is one of the main reasons why more than half of the projects that MX Mining is working on are coal-related.

The projects that the companies are working with include a coal-to-liquids project in Botswana, a coal exploration project in Limpopo, an aggregate mine development project in Mpumalanga, a metals project in Limpopo, a phosphate project in Zambia, a gold project in the Democratic Republic of Congo and a coal project in Poland.

Go to Source

Go to Source

KARACHI: More than half of the registered companies in the country failed to file their income tax returns for the tax year 2016, pointing to a weak law enforcement by the authorities, sources said on Thursday.   

Sources said the Federal Board of Revenue (FBR) has detected around 41,800 non-filer corporate entities, which are registered with Securities and Exchange Commission of Pakistan (SECP). 

The number of registered companies with SECP rose to 81,493 in the fiscal year of 2016/17 from 73,207 a year earlier. Officials said under Section 114 of Income Tax Ordinance 2001, every incorporated company is required to file income tax return even in case of losses or no income derived during the tax year. FBR received around 31,400 corporate returns filed till August 10 for tax year 2016.

Tax experts said the available data is a telltale sign of FBR’s weak enforcement.  The experts said the FBR should improve enforcement and ensure the return filing by corporate entities as all the documents are already available with SECP. Presently, companies are filing returns to avail tax concessions and refunds, they added.

The number of corporate return filings, however, increased 25 percent during the last four years (2013-2016). Number of companies registered with SECP grew 36 percent during the same period.

Sources said the FBR has obtained information related to non-filer corporate entities from the commission. The board started issuing notices to the companies for filing their mandatory returns for tax year 2016.  They said a majority of the companies, which filed income tax returns for tax year 2016, have declared no income. Tax authorities are also examining the records of such companies to identify tax evasion.

Pakistan has a narrow tax base. Only four million people, including individuals, companies and association of persons, are registered as income taxpayers. Of total registered taxpayers, only 1.23 million are filing tax returns, according to the latest active taxpayers list.

Government could not attract companies to fulfill their obligation of return filing despite a significant reduction in corporate tax rates during the last five years. Corporate tax rates were slashed to 30 percent in the current tax year of 2018 from 35 percent in tax year 2013.  The apex tax authority received a total of 1.2 million tax returns by June 30 for the tax year 2016, depicting a 20 percent growth over a year ago.

FBR began an aggressive drive to encourage returns filing. It slaps additional withholding tax on non-cash banking transactions to broaden the taxpayers’ base. The government, in the budget for 2015/16 fiscal year, introduced Section 236P into Income Tax Ordinance 2001 and imposed withholding tax rate of 0.6 percent on non-filers, while they make non-cash banking transaction above Rs50,000 in a day. The rate was reduced to 0.3 percent on July 15, 2015, but edged up to 0.4 percent in March 2016. The tax rate is applicable till September 2017.

Go to Source

Go to Source

Interested in Workers’ Comp?
Get automatic alerts for this topic.

Go to Source

When the Federal Communications Commission went looking this year for experts to sit on an advisory committee regarding deployment of high-speed internet, Gary Carter thought he would be a logical choice.

Carter works for the city of Santa Monica, California, where he oversees City Net, one of the oldest municipal-run networks in the nation. The network sells high-speed internet to local businesses, and uses the revenue in part to connect low-income neighborhoods.

That experience seemed to be a good match for the proposed Broadband Deployment Advisory Committee (BDAC), which FCC Chairman Ajit Pai created this year. One of the panel’s stated goals is to streamline city and state rules that might accelerate installation of high-speed internet. But one of the unstated goals, members say, is to make it easier for companies to build networks for the next generation wireless technology, called 5G. The advanced network, which promises faster speeds, will require that millions of small cells and towers be erected nationwide on city- and state-owned public property.

The assignment seemed to call out for participation from city officials like Carter, since municipal officials approve where and what equipment telecommunications companies can place on public rights of way, poles and buildings.

But the FCC didn’t choose Carter — or almost any of the other city or state government officials who applied. Sixty-four city and state officials were nominated for the panel, but the agency initially chose only two: Sam Liccardo, mayor of San Jose, California, and Kelleigh Cole from the Utah Governor’s Office, according to documents obtained by the Center for Public Integrity through a Freedom of Information Act request. Pai later appointed another city official, Andy Huckaba, a member of the Lenexa, Kansas, city council.

Instead the FCC loaded the 30-member panel with corporate executives, trade groups and free-market scholars. More than three out of four seats on the BDAC are filled by business-friendly representatives from the biggest wireless and cable companies such as AT&T Inc., Comcast Corp., Sprint Corp., and TDS Telecom. Crown Castle International Corp., the nation’s largest wireless infrastructure company, and Southern Co., the nation’s second-largest utility firm, have representatives on the panel. Also appointed to the panel were broadband experts from conservative think tanks who have been critical of FCC regulations such as the International Center for Law and Economics and the Mercatus Center at George Mason University.

The same lopsided ratio can be found on the BDAC’s four working groups that will propose changes to telecommunications policies that Pai views as barriers to broadband deployment. The municipal working group, with 24 members, is tasked with creating a model code for cities to follow that would expedite the deployment of cells and poles. The groups consist of BDAC members as well as additional people the FCC appointed, mostly from the telecommunications industry.

The FCC says the makeup of the BDAC and its subgroups represents a diversity of views and those who best understand the issues. But local officials say their exclusion from the committee reflects a not-so-hidden agenda — one pushed by Pai himself with help from his allies in Big Telecom: to create a set of rules that lets the telecom more easily put their equipment in neighborhoods with far less local oversight.   

“When I called [the FCC] to check on the status of the BDAC selection process [earlier this year] and identified myself as an employee from the City of Santa Monica, the gentleman on the phone laughed hysterically,” Carter said. “At first I didn’t get the joke. When I saw the appointees for the municipal working group — only three out of 24 positions were from local government — I got the joke.”

The FCC had no comment other than to note they were made aware of the incident. (Update, Aug. 11, 2017, 11:45 a.m.: The FCC says they were made aware of the incident by the Center.) But the interaction underscores what Liccardo now faces as one of the only city representatives on the committee.

“It’s not lost on us that among the 30-odd members of the BDAC, only two represent local government,” Liccardo said. “We’ll see where things go in the weeks ahead, but it’s fair to say the footprints are in the snow.”

Millions of Cells

The BDAC was formed in April and charged with making “recommendations to the Commission on how to accelerate the deployment of high-speed Internet access,” including developing model codes for cities and states to approve broadband permits, and removing local and state regulatory barriers. The committee has held two meetings, one in April and another in July, with another one scheduled for this fall. It plans to submit its proposals by November to the FCC. The guidelines will be voluntary for cities, but the FCC may decide to include them in new rules that cities would be required to follow.

At issue for the BDAC is the nationwide buildout of 5G, the new wireless technology that promises to provide faster speeds. It also requires millions of small cells and poles distributed mostly throughout cities and suburbs in rights of way, such as land next to city streets, highways and parks. Local permitting offices from Oyster Bay, New York, to Seattle, Washington, have been flooded with applications to deploy the cells and build new poles, slowing down the approval process and frustrating telecoms. Telecommunications firms and the companies building the wireless infrastructure want the FCC to pass recommendations that would force cities to shorten the permitting process and lower fees.

When he announced his intention to form the BDAC, Pai, whom President Donald Trump appointed chairman in January, said he wanted the forum to balance city and industry views.

The BDAC will be “forward-looking and fair, balancing the legitimate interests of municipalities with the ever-growing demands of the American public for better, faster, and cheaper broadband,” he said last year in a speech about closing the digital divide.

Pai said at a press conference this month that the BDAC has diverse representation, but he mostly cited as examples representatives from the telecommunications industry: independent builders, network operators, and wireless, cable and satellite interests.

“I wish we could accommodate everybody of course,”Pai said, “but that’s just not possible with a limited advisory committee that we’ve got.” 

The Center for Public Integrity asked the FCC for interviews with agency officials who chose the BDAC members, but requests went unanswered. In an emailed statement sent later, Mark Wigfield, a spokesman for the FCC, said, “We believe the makeup of the BDAC reflects the diversity we sought.”

Nick Degani, senior counsel to the FCC and Pai’s wireline legal advisor, told BDAC members at the July meeting that few city officials were chosen because they are the ones that need guidance — presumably not telecommunications companies.

“To be frank, we didn’t want to choose someone from, say, a municipality that needs a blueprint, because they’re not going to be the ones to help design that blueprint,” Degani said. “It’s you guys [BDAC members who mostly represent the telecommunications industry] who have been working on this.”

But with the committee’s lopsided industry representation, city and state officials say any regulatory change the BDAC proposes is likely to ignore local residents’ wishes. Concerns range from poles draped with bulky equipment that block scenic views and clutter neighborhoods – to serious safety risks.

“There are reasons you have to get a permit if you want to dig up the side of the street,” said David Frasher, city manager of Hot Springs, Arkansas, who also was nominated — but turned down — for a seat on the BDAC.

“The city needs to know if you’re going to block traffic or create a hazard to sidewalk users,” Frasher said. “Maybe there’s a way to streamline those regulations, … but with only 10 percent city government representation, how helpful will the end product be?”

The FCC also didn’t choose David Guttenberg, member of the Alaska state legislature. He said service providers writing local rules for internet deployment makes him fear for Alaskan residents, many of whom have such poor wireless service that they have trouble downloading emails.

“They [telecommunications companies] are only going to look after their own self interests,” Guttenberg said. “Find me the guy that works for telecommunications on this committee that’s going to sign onto a plan telling their business to do something they don’t want to do. Find me that guy.”

The National League of Cities, which represents more than 1,600 cities, met with FCC Commissioner Mignon Clyburn in May “to urge the Commission to increase the number and diversity of local officials on the BDAC to a level comparable with the number and diversity of industry officials.”

Among other municipal officials nominated but not chosen for the BDAC: Bruce Patterson, technology director for Ammon, Idaho; Jack Belcher, chief information officer for Arlington, Virginia; Peter Collins, information technologies manager for Geneva, Illinois.

The lack of municipal representation doesn’t surprise one telecommunications executive sitting on the BDAC, who told the Center for Public Integrity that the committee is “stacked” to fix the proposals to meet Pai’s anti-regulatory agenda.

“It’s definitely stacked towards private enterprise,” said the executive, who requested anonymity due to fear of retaliation from FCC officials. “It’s nothing new. The FCC serves private enterprise.”

BDAC members who didn’t return requests to comment included AT&T, Google, Southern Light LLC, the International Center for Law and Economics, and Christopher Yoo, a law and communications professor at the University of Pennsylvania. Yoo also is a member of the Board of Academic Advisors for the Free State Foundation, which for years has received support from large telecommunications trade groups such as NCTA – The Internet and Television Association, and CTIA, which represents U.S. wireless corporations, according to the Center for Public Integrity’s non-profit donations database.

Officials with Crown Castle, Comcast, TDS Telecom, and Utah’s Cole, who serves as the BDAC vice chairman, declined to comment.

Telecoms vs. Cities

At BDAC’s first meeting in April, Kelly McGriff, general counsel at Southern Light, which provides wireless infrastructure along the U.S. Gulf Coast and is now part of Uniti Group Inc., said broadband projects have been delayed by six months in some cities because municipal officials don’t understand the infrastructure they’re tasked with approving.

Larry Thompson, CEO of Vantage Point Solutions Inc., represented the National Exchange Carrier Association at the meeting. NECA includes more than 1,300 member telephone companies, said local permitting rules cost one of its members $700,000 to cover environmental, historical preservation and other reviews before expanding their network.

“I see time and time again things like that happening where that money could’ve gone a long ways towards actually building the broadband network rather than the preliminary stuff leading up to the broadband network,” Thompson said.

City officials said they understand the need for the technology, pointing out that more than 500 municipalities operate their own broadband networks, including Carter’s Santa Monica. Officials also said the fees telecommunications companies pay are necessary for ongoing maintenance of the public property the cells and poles occupy.

Some broadband companies concede that a lack of local government representation on the committee may present a problem.

“We have a lot of groups who are concerned that they’re not at the table,” David Don, vice president of regulatory policy at Comcast, said at the BDAC’s July meeting. “And if they don’t feel included, not only are they outside throwing [darts] at this process, but then in the end it’s those groups that we want to adopt these model codes.”

What Pai has done by loading up the panel with industry representatives is, in the end, “pretty standard in Washington,” said Sarah Treul, a political science professor at the University of North Carolina at Chapel Hill.   “The FCC expects certain outcomes from this advisory committee.”

Go to Source

The travel secrets of high-flying CEOs

From private jets to the minutiae of dietary requirements, Jaclyn Sienna India, founder of travel consultancy Sienna Charles, ensures the finance world’s elite get the trips they want

Go to Source

Manchester’s thriving tech sector now accounts for nearly half of all enquiries for city centre office space, say consultants.

A steady rise in tech, media and telecoms sector take up is eating city centre floorspace.

Colliers International say that almost 40% of new enquiries coming from the technology sector alone as operators seek access to Manchester’s skilled workforce.

Manchester already has around 63,000 tech jobs – almost as many as the combined total for Liverpool (23,000), Leeds (24,000) and Sheffield (19,000) – and it is growing fast.

The growth of the tech sector has been emphasised by the arrival in the city of global co-working specialist WeWork.

They have signed up for 60,000 sq ft at Allied London’s No1 Spinningfields. The Manchester office will be their first UK location outside of London.

Joe Gaunt, the UK managing director for WeWork, said: “Manchester is an obvious choice for our second city.

“The city has excellent infrastructure and a growing tech and start-up sector and is showing itself to be an increasingly appealing destination providing a fantastic work life balance.”

Rob Yates, partner and head of office agency at Cushman & Wakefield Manchester, said: “The fact that WeWork has chosen Manchester for its first UK office outside the capital is testament to our belief of the underlying strengths of the Manchester offer.

“The pull of the city is immense making it is the obvious destination for occupiers considering the regions, offering quality accommodation, access to a highly skilled young talent pool and a good quality of life.”

The claims come as agents predict that London-based businesses moving north will tip Manchester city centre office take over 1m sq ft this year, consultants are predicting.

More London-based businesses seeking premises in Manchester means total office take-up in the city is set to exceed more than 1 million sq ft for the fourth successive year, according to the latest office market snapshot by real estate advisors Colliers International.

Colliers said that a strong pipeline of enquiries from businesses in the capital, along with relocators from elsewhere in the UK and from overseas, meant a positive outlook for the Manchester office market as the city’s property business prepares for the autumn deal-making season.

They follow London-based international law firm Freshfields Bruckhaus Deringer, taking 80,848 sq ft at One New Bailey, Salford.

Peter Gallagher, director at the Manchester office of Colliers International, said: “Over the next two years, there are at least 1.2m sq ft of lease events for more than 3,000 sq ft and a further 1.12 million sq ft facing three or five-year rent review.

“Given the strong pipeline of enquiries and the prospect of several London-based occupiers looking to set up offices in Manchester to cut costs, the outlook for the rest of 2017 looks positive with take-up set to exceed one million sq ft for fourth year in a row.”

Colliers’ reported that office market sentiment remained upbeat with a ‘solid’ take-up of 284,497 sq ft of space in the second quarter of 2017, bringing the total take-up for the entire first half of the year to 492,730 sq ft.

The figures for the quarter and the half year represented increases of 37 per cent and 17 per cent respectively on the totals for the same periods of 2016.

A total of 68 deals in the second quarter included five transactions involving in excess of 10,000 sq ft such as existing current city centre occupiers Kaplan Financial and CarFinance247 both relocating to Universal Square.

Colliers’ research reiterated that with no new Grade A build completions due in 2018 and demand continuing to squeeze supply, prime rents in central Manchester were expected to continue rising and to hit £40 per sq ft by 2020.

As available Grade A stock remained limited, demand for Grade B office space rose by 10 per cent year-on-year to £27 per sq ft.

With funding for speculative development still hard to come by, just two new developments have started in 2017 – the 180,000 sq ft Landmark Grade A office scheme on the former Odeon cinema site bordering St Peter’s Square and 125 Deansgate (formerly Lincoln House) while three other major schemes at 11 York Street, 100 Embankment and two New Baily Square are due to be underway this year.

Go to Source

A person who has to receive a payment from an insolvent company can now seek the claim under the insolvency law as the revised regulations have enabled owners of undelivered flats to get relief.

Till now, only financial and operational creditors were permitted to seek claims under the Insolvency and Bankruptcy Code (IBC).

The revised regulations come at a time when a large number of flat buyers have been left in the lurch, especially in the National Capital Region (NCR), due to long delay in deliveries amid the developers citing fund crunch.

The Insolvency and Bankruptcy Board of India (IBBI), which is implementing the Code, has amended the regulations whereby claims can be made by creditors other than financial and operational creditors.

Such entities should submit proof of their claims to the interim resolution professional or resolution professional, as per a notification issued by the IBBI on Wednesday.

“There could be claims from a creditor who is not a financial creditor or an operational creditor and it needs a specific form for submitting its claim. The IBBI has amended these regulations today to provide for a form for submission claims by creditors other than financial and operational creditors,” the IBBI said in a release.

The form can be submitted under the Corporate Insolvency Resolution Process.

According to the notification, the existence of the claim can be verified by way of “documentary evidence demanding satisfaction of the claim… and bank statements of the creditor showing non-satisfaction of claim”, among other options.

Once a case is admitted for insolvency or bankruptcy by the National Company Law Tribunal (NCLT), then an interim resolution professional is appointed to take the process forward.

The interim resolution professional would “collect all information relating to the assets, finances and operations of the corporate debtor for determining its financial position.

Under the IBC, financial creditor implies any person to whom a financial debt is owed. The financial debt can include money borrowed for interest.

Operational creditor means a person to whom a company owes an operational debt, which includes those with respect to provision of goods or services.

Thousands of home buyers had been left in the lurch after the Allahabad bench of the National Company Law Tribunal (NCLT) admitted IDBI’s plea for initiating insolvency proceedings against Jaypee Infratech for defaulting on a Rs 526-crore loan.

The NCLT has appointed Anuj Jain the interim resolution professional to carry out the proceedings under the IBC.

Bank of Baroda has approached the NCLT seeking to start proceedings for insolvency against Amrapali for defaulting on loans.

On Wednesday, Corporate Affairs Minister Arun Jaitley said, “”our full sympathy” is with the aggrieved home buyers.

“Those who are aggrieved can get remedy under this law (IBC). If there is any such move, the government’s full sympathy is with those who have paid money and have rights on the flats,” the minister had said in response to a question on problems being faced by the home buyers in Noida.

Go to Source