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Non performing asset

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Querist : Anonymous

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Querist : Anonymous (Querist)
13 December 2013 We have borrowed TL from a Bank. As per the original sanction letter, the date of last draw down was 30.06.2013. Later on we extended the date of last drawn down to 31.12.2013. The bank is insisting us to show the commercial production on or before 31.12.2013, else the account will become NPA. Kindly advice us?

Thanks,
Shrirang
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
13 December 2013 should not become NPA. check whether any moratorium was provided or not for the interest. In absence of moratorium, if interest is not paid, NPA norms will get triggered.
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Querist : Anonymous

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Querist : Anonymous (Querist)
13 December 2013 Dear Sir,
Thank you very much.

There is a moratorium of 1 year. However we are paying the interest regularly during the moratorium period.

The repayment in term loan start from Jan 2014. We will be paying the installment regularly.

If there is a delay in commercial production will the account become NPA
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Querist : Anonymous

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Querist : Anonymous (Querist)
13 December 2013 Dear Sir,
Thank you very much.

There is a moratorium of 1 year. However we are paying the interest regularly during the moratorium period.

The repayment in term loan start from Jan 2014. We will be paying the installment regularly.

If there is a delay in commercial production will the account become NPA
Avatar

Querist : Anonymous

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Querist : Anonymous (Querist)
13 December 2013 Dear Sir,
Thank you very much.

There is a moratorium of 1 year. However we are paying the interest regularly during the moratorium period.

The repayment in term loan start from Jan 2014. We will be paying the installment regularly.

If there is a delay in commercial production will the account become NPA
Avatar

Querist : Anonymous

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Querist : Anonymous (Querist)
13 December 2013 Dear Sir,
Thank you very much.

There is a moratorium of 1 year. However we are paying the interest regularly during the moratorium period.

The repayment in term loan start from Jan 2014. We will be paying the installment regularly.

If there is a delay in commercial production will the account become NPA
Avatar

Querist : Anonymous

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Querist : Anonymous (Querist)
13 December 2013 Dear Sir,
Thank you very much.

There is a moratorium of 1 year. However we are paying the interest regularly during the moratorium period.

The repayment in term loan start from Jan 2014. We will be paying the installment regularly.

If there is a delay in commercial production will the account become NPA
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
14 December 2013 what sort of project is this loan for? different type of projects have different NPA norms. For eg infra project has 2 years delay in COD as NPA trigger.
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Querist : Anonymous

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Querist : Anonymous (Querist)
14 December 2013 Dear Sir,

Once again thank you very much for the reply.

This project is not an infra project, it is non infra project. As per the sanctioned term the date of commercial production as per sanctioned agreement is 01.07.2013.

Thanks,
Shrirang
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Nikhil Kaushik

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Nikhil Kaushik (Expert)
14 December 2013 Depending on compliance with other provisions, RBI extended the NPA guidelines from 6 months to 1 year for non-infra projects. So you may check with your bank regarding applicability of the said amendment to your case.
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