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Wednesday,28-July-2021

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MCA files revised formula for sharing resolution proceeds in NCLAT

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IL&FS

The Ministry of Corporate Affairs (MCA) has urged the National Company Law Appellate Tribunal (NCLAT) to approve the revised formula for sharing resolution proceeds from the disposal of bankrupt IL&FS group firms among its creditors in a fair and equitable manner.

The revised mechanism would provide for distribution of residual proceeds over and above liquidation value of assets to other than secured creditors.

The MCA has submitted the fresh affidavit in the company law tribunal representing the new IL&FS Board which took over the group in 2018.

In its affidavit filed on January 9, Rajesh Tiwari, Joint Director (Western Region) in MCA, also submitted to remove Power Finance Corporation (PFC) from among “top five creditors” as IL&FS group shares in Wind SPVs have been transferred to ORIX.

The affidavit has appealed the tribunal to declare and direct all financial creditors of the relevant IL&FS group entity, including group lenders, to be part of the Creditors’ Committee constituted or to be constituted in accordance with the modified resolution framework.

Some of the creditors had earlier objected to internal IL&FS group companies as creditors as they had been involved in alleged financial bungling or fraud.

Inclusion of internal group firms among the secured creditors and part of Creditors’ Committee would ensure they get the share of the proceeds realised by sale, disposal or closure of the defaulted companies.

Among other key submissions is a direction for first making payments towards the resolution process cost involving financial and transaction advisors, legal counsels and resolution consultants, among others. This will be followed by the creditors in accordance with Section 53 of Insolvency and Bankruptcy Code (IBC).

“Third, the remaining sale proceeds/termination amount/settlement amount to be distributed pro-rata to each class of creditors of the relevant IL&FS Group entity, adjusted for any recovery made by the relevant creditors on account of distribution under Section 53 of IBC, as contemplated above,” the affidavit said.

IL&FS group, which has about Rs 91,000 crore in debt, is in the bankruptcy court following its defaults that shook the entire financial sector of the country and triggered the NBFC liquidity crisis.

During the period July 2018 to September 2018, two of its subsidiaries reported having trouble in paying back loans and inter-corporate deposits to lenders. This was followed by multiple subsidiaries defaulting and the group heading to bankruptcy.

Business

Apple posts record growth in India in June quarter, says Tim Cook

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Apple

Riding on the stellar performance for its entire line-up of products, Apple has recorded an incredible growth in India in the June quarter, its CEO Tim Cook has said, setting another record revenue in a country where iPhones and other Apple products fast gained momentum despite the country being hit by the second Covid wave.

In an earnings call after posting a new June quarter revenue record of $81.4 billion globally, up 36 per cent from last year, Cook said late on Tuesday that emerging markets like India has done extremely well.

“We had an incredible quarter for the emerging markets in Q3. We set June quarter records in Mexico, Brazil, Chile, Turkey, UAE, Poland, Czech Republic, India, obviously in China as I talked about before. Those results are for the entire line of products that we have,” Cook informed.

“The vast majority of markets we tracked grew double digits, with especially strong growth in emerging markets, including India,” he added.

In the festive quarter (October-December 2020), the company doubled its India smartphone share to 4 per cent, riding on the stellar performance of iPhone 11 and XR.

The strong performance by its iPhone 12 series line-up made sure a record June quarter for the company.

“If you take India for example, we doubled our business last quarter compared to a year ago but our absolute level of business there is still quite low relative to the size of the opportunity,” Cook had said in January this year.

Apple, which has already started manufacturing certain iPhone models in India, has worked out locations for its retail stores in the country as well.

Cook said the company is doing a number of things in India.

“There are several markets I alluded to before. India is one of those where our share is quite low. It did improve from the year ago quarter, our business roughly doubled over that period of time, so we feel very good about the trajectory,” Cook elaborated.

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Business

Google Search, YouTube sales soar to record high in pandemic

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Google

Riding on Search and YouTube advertising growth amid the pandemic, Alphabet has posted a record $61.88 billion in revenue for its June quarter.

Google Search reached a record $35.8 billion in revenue (up 68 per cent) while YouTube advertising revenue nearly doubled to $7 billion compared to $3.8 billion from the same quarter last year, the company said late on Tuesday.

“In Q2, there was a rising tide of online activity in many parts of the world, and we’re proud that our services helped so many consumers and businesses. Our long-term investments in AI and Google Cloud are helping us drive significant improvements in everyone’s digital experience,” said Sundar Pichai, CEO of Google and Alphabet.

Google Cloud revenue was $4.63 billion, up from $3.01 billion a year ago. The Google Cloud business witnessed operating losses of $591 million, a solid improvement from $1.43 billion loss last year.

“Our strong second quarter revenues of $61.9 billion reflect elevated consumer online activity and broad-based strength in advertiser spend. Again, we benefited from excellent execution across the board by our teams,” said Ruth Porat, CFO of Google and Alphabet.

Other revenues were $6.6 billion, up 29 per cent, primarily driven by growth in YouTube non-advertising revenues, followed by Hardware, “which benefited from the addition of Fitbit revenues and finally Google Play which lapped the increased level of user engagement that started in Q1 last year due to the pandemic,” Porat added.

The strong growth in Google Workspace revenues was driven by robust growth in both seats and average revenue per seat.

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Business

Sugarcane output per hectare rises in UP

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Sugarcane

 Uttar Pradesh has scored another high with the sugarcane cultivation.

According to a government spokesman, the average cane production reached 815 quintal per hectare in 2020-21. In the last fiscal year, the average cane production was to the tune of 811 quintal per hectare.

Shamli district in western Uttar Pradersh has topped the chart by producing over 1,004 quintal per hectare of sugarcane, followed by Muzaffarnagar which recorded 923.20 quintal per hectare.

In fact, of the top 10 districts, nine are from the agriculturally rich western UP.

The state has 45 cane producing zones.

Additional chief secretary (cane development) Sanjay Bhoosreddy said that the higher cane production was a result of crop cutting practice which was intensely used in the 2020-21 cane cultivation season.

He maintained that it was also because of the timely payment of cane price and associating farmers with the new cropping techniques which have led to an increase in the sugar cane production.

The high cane production happens to be directly linked to cane price payment which is scheduled to be done by the mills, essentially in the private sector, to the farmers.

The farmer groups, as a matter of fact, are up in arms claiming that around Rs 12,000 crore of cane payment is due for the 2020-21 season.

Cane department officials, however, maintained that it was committed to get the payment of cane prices done on a timely basis.

The state government has been highlighting how it has ensured a payment of over 1.4 lakh crore to the cane growers in the last four years.

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