Yashovardhan Birla declared 'wilful defaulter' by UCO bank
Yashovardhan Birla is the director of Birla Surya and also chairman of the Yash Birla Group which has more than a dozen companies.
Chairman of the Yash Birla group, Yashovardhan Birla, also known as Yash Birla, has declared a ‘wilful defaulter’ on June 16, 2019 by Kolkata-based UCO Bank. UCO Bank claimed that one of Yashovardhan’s group companies, Birla Surya, defaulted on loans of Rs 67.65 crore.
As per the UCO bank’s statement given to the media, Yash Birla was sent several notices regarding the repayment of the loan. His company was given a credit limit of Rs. 1 billion to manufacture multi-crystalline solar photovoltaic cells.
| What’s the matter? |
| According to a public notice issued by UCO Bank, which also carries Yashovardhan Birla’s photograph, Birla Surya was sanctioned a credit limit of Rs 100 crore of fund-based facilities for the purpose of manufacturing of multi-crystalline solar photovoltaic cells from the bank’s flagship corporate branch at Nariman Point, Mumbai. The present balance outstanding is Rs 67.65 crore, in addition to unapplied interest from the date of the account turning into a non-performing asset (NPA). Due to non-repayment of dues to the bank, the account was declared NPA on 3 June 2013. The borrower has not repaid the dues owed to the bank despite several notices,” UCO Bank said in the notice, adding, “the borrower company and its directors, promoters, guarantors were declared as wilful defaulters by the bank and their name reported to the credit information companies for public information. |
RBI’s wilful default definition
The term "wilful default" has been redefined in supersession of the earlier definition as under:
A "wilful default" would be deemed to have occurred if any of the following events is noted:-
(a) The unit has defaulted in meeting its payment / repayment obligations to the lender even when it has the capacity to honour the said obligations.
(b) The unit has defaulted in meeting its payment / repayment obligations to the lender and has not utilised the finance from the lender for the specific purposes for which finance was availed of but has diverted the funds for other purposes.
(c) The unit has defaulted in meeting its payment / repayment obligations to the lender and has siphoned off the funds so that the funds have not been utilised for the specific purpose for which finance was availed of, nor are the funds available with the unit in the form of other assets.
(d) The unit has defaulted in meeting its payment / repayment obligations to the lender and has also disposed off or removed the movable fixed assets or immovable property given by him or it for the purpose of securing a term loan without the knowledge of the bank/lender.
| Note |
| Former finance minister Arun Jaitley had said in a written reply to a question in the Lok Sabha in December 2018 - as per data reported by Public Service Banks (PSBs), till September 30, 2018, total 2,571 FIRs have been registered against wilful defaulters, 9,363 suits have been filed for recovery from them, and action has been initiated under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 in respect of 7,616 cases of wilful defaulters. |
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