Banks

We provide following services to Banks in India for their Corporate clients.

  • Diligence report by companies availing finance from multiple banks, regarding compliance of various statutory prescriptions that are in vogue, as per specimen of prescribed by the RBI, (as per RBI circular No. DBOD No. BP. BC. 46/08.12.001/2008-09 dated September 19, 2008; as amended from time to time).
  • Recovery of debts(on action plan / modus operandi)
  • Search report for charges registered over assets (as registered with the Registrar of Companies)
  • Registration of charges (creation, modification and satisfaction of charges) over assets of Indian companies with the Registrar of Companies.
  • Appearing before the Company Law Board for registration of charges (in case of disputes)
  • Apply to Company Law Board for extension of time, in case of delay in registration of charges.
  • Services to Banks under External Commercial Borrowings (ECB) guidelines.

We certify compliance or otherwise of conditions of ECB guidelines to enable banks to convey ‘no objection’ to borrower.
Under ECB guidelines, AD Category – I banks have been delegated powers to convey ‘no objection’ under the Foreign Exchange Management Act (FEMA), 1999 for creation of charge on immovable assets, financial securities and issue of corporate or personal guarantees in favour of overseas lender / security trustee, to secure the ECB to be raised by the borrower.
Before according ‘no objection’ under FEMA, 1999, AD Category – I banks should ensure and satisfy themselves that
(i) the underlying ECB is strictly in compliance with the extant ECB guidelines,
(ii) there exists a security clause in the loan agreement,
(iii) the loan agreement has been signed by both the lender and the borrower, and
(iv) the borrower has obtained Loan Registration Number (LRN) from the Reserve Bank.

On compliance with the above conditions, AD Category – I banks may convey their ‘no objection’, under FEMA, 1999 for creation of charge on immovable assets, financial securities and issue of personal or corporate guarantee, subject to the conditions indicated below:

a) The ‘no objection’ for creation of charge on immovable assets may be conveyed under FEMA, 1999 either in favour of the lender or the security trustee, subject to the following conditions:
(i) ‘No objection’ shall be granted only to a resident ECB borrower.
(ii) The period of such charge on immovable assets has to be co-terminus with the maturity of the underlying ECB.
(iii) Such ‘no objection’ should not be construed as a permission to acquire immovable asset (property) in India, by the overseas lender / security trustee.
(iv) In the event of enforcement / invocation of the charge, the immovable asset (property) will have to be sold only to a person resident in India and the sale proceeds shall be repatriated to liquidate the outstanding ECB.

b) The ‘no objection’ to the resident ECB borrower for issue of corporate or personal guarantee under FEMA, 1999 may be conveyed after obtaining
(i) Board Resolution for issue of corporate guarantee from the company issuing such guarantees, specifying names of the officials authorised to execute such guarantees on behalf of the company or in individual capacity.
(ii) Specific requests from individuals to issue personal guarantee indicating details of the ECB.
(iii) Ensuring that the period of such corporate or personal guarantee is co-terminus with the maturity of the underlying ECB.

AD Category – I banks may invariably specify that the ‘no objection’ is issued from the foreign exchange angle under the provisions of FEMA, 1999 and should not be construed as an approval by any other statutory authority or Government under any other law/ regulation. If further approval or permission is required from any other regulatory / statutory authority or Government under the relevant laws / regulations, the applicant should take the approval of the authority concerned before undertaking the transaction. Further, the ‘no objection’ should not be construed as regularizing or validating any irregularities, contravention or other lapses, if any, under the provisions of FEMA or any other laws or regulations. The designated Authorised Dealer banks has the general permission to make remittances of installments of ECB principal, interest and other charges in conformity with ECB guidelines, issued by Government / Reserve Bank of India from time to time.

For any questions / discussion on the matter, you may write to us.

 

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