Only 26 judges are there for bankruptcy cases

Investors from Blackstone Group LP to Oak tree Capital Group LLC are salivating over an estimated $210 billion of stressed assets that are up for grabs. Bankruptcy cases are increasing day by day but the number of Judges is very less in the court rooms. The latest official data show that 10 benches with a combined 26 judges and technical staff are hearing more than 2,500 insolvency cases.

The bankruptcy process is crucial for Prime Minister Narendra Modi’s attempts to come to grips with a simmering banking crisis that’s sucking energy out of India’s economy. The large global investors who are lining up to chase bargains across industries ranging from steel to cement also implicated by the failure to resolve the shortage of judges.

Narendra Modi

Oak tree is following India’s insolvency process and says may open a local office under the right circumstances. In January 2017, NCLT gained full powers when India’s new bankruptcy laws took effect. Last week, Electrosteel Steels Ltd became the first large defaulter to complete the revamped bankruptcy process.

The bankruptcy process risks are getting complicated by challenges to the court’s orders. Renaissance Steel bid to buy Electrosteel under the bankruptcy process plans to appeal the decision to award Electrosteel to Vedanta Ltd. The government is aware of the shortage of judges and is in the process of appointing more though numbers can’t be confirmed immediately.

In the absence of more judges it will be difficult for them to deal with the workload but these courts don’t have time to hear company law related matters as they say the insolvency cases are taking up all their time.