ou have probably heard of CIBIL scores more times than you can count.

But, did you

know what these scores mean? 

Your CIBIL score is essentially a numeric representation of how creditworthy you are
and ranges between 300 to 900. When lenders provide loans, your interest rate,
repayment term, etc., are determined by how risky the lenders perceive you to be.

If your score is high, i.e., above 750, then the lenders consider you to be someone
who will repay loans on time and therefore present less risk. Therefore, you will be
able to avail loans at lower interest rates.

How is CIBIL Score Calculated

Your credit score is based on multiple parameters such as your repayment history,
type of credit availed, repayment duration, existing debt, credit utilization ratio,
credit enquiries, etc. All of these will have an impact on your credit score.

Your CIBIL Score Decoded 

Curious to find out your creditworthiness? Your CIBIL score can tell you that. Here’s
what these scores really mean –

300 to 599 – Poor

It is time to pull up your socks and turn around your financial habits because they
could cost you dear in the long run. Such scores are a result of either defaulting on
loan payments, settling your loan, opting for multiple loans at the same time or
having an extremely high credit utilization ratio. 

These scores make it hard to avail loans and most lenders do not provide loans to
borrowers with such low scores. Even if they do, the interest rates and repayment
terms will be very strict and not to the your advantage at all.

Note: If you do not have credit history or are new to the system, your credit score
will probably be reported as N/A. While this is not looked at negatively, not all
lenders provide loans to first time borrowers. 

600 to 749 – Fair

Well, looks like there is some work to be done here. While you are not in the ‘danger
zone’ of becoming a borrower that lenders actively avoid, a CIBIL score in this range
is not ideal, especially if your score is below 700. Have you perhaps missed one or
two of your EMIs?  Or is your credit utilization ratio high? Have you availed multiple
loans at the same time? 

There can be a number of reasons for a score this low but it is important that you
build this up. Wondering why a high CIBIL score is important? Click here.

750 to 849 – Good

If this is your credit score then well done! You have definitely been repaying your
loans on time and probably have a healthy mix of secured and unsecured loans as
well.

Additionally you have probably followed certain best practices such as availing only
one loan at a time and paying more than just the minimum amount due for credit
card bills. 

Not only will you receive loans easily, you also have a fair bit of space to negotiate
your terms and conditions. Continue to go down the route and ensure that you
maintain your current repayment habits.

850 and Above – Excellent

Congratulations! You have officially unlocked the last level and are no less than a
legend! You either have the most perfect credit record or you’ve managed to hack
the CIBIL servers…we really hope it is the first one!
 Having a CIBIL score above 850 may not be easily achievable but it is definitely
possible. If this is your score then not only have you been consistently repaying all
your debts on time but you have also learned to manage your finances
(repayments, credit utilization, maintaining old credit cards, etc.) perfectly right from
the get-go. Every expert advice on how to increase one’s credit score has been
followed!

You are every lender’s dream customer and will have no problem getting a loan on
your terms and conditions along with the lowest possible interest rate. 

Is Building Credit Hard? 

While a credit score below 750 is not ideal, the good news is that you can always
build it & improve step-by-step by following these guidelines –
 Repay your loans on time

This is perhaps the most important step to follow as missing out on your EMI
payments has a detrimental impact on your credit score. 
 Pay more than just the minimum amount due

If you are a credit card user, try your best to pay more than the minimum. Not only
will this help you pay off your bills earlier, it will also help you increase your credit
score over time
 Maintain a low credit utilization limit

Ideally, your credit utilization should not exceed 30% of the limit 
 Have a healthy mix of credit
 Having multiple unsecured loans at the same time can have a negative impact on
your credit score. A mix of secured (home loans, car loans) and unsecured (personal
loans, credit cards) loans is recommended
 Review your credit score regularly

You can check your credit score for free once a year or subscribe to affordable paid
plans. It is important to keep an eye out for discrepancies or mistakes that can
affect your credit score

To know more about how you can increase your CIBIL score, check out our
extensive guide on the same.

In Conclusion
Imagine availing loans at low interest rates and on your terms and conditions! If this
seems unreasonable, we assure you it is possible. All you need to do is have a good
CIBIL score. Although this seems easier said than done, there are a number of
disciplined steps you can take to build your score if it is low or maintain it if your
score is already high. 

Did you know that a great way to build your score, especially if you are new to
credit, is by getting instant personal loans from Money View. Not only are these
loans versatile, they can be disbursed within 24 hours of approval. Visit the Money
View website or download the app to apply today!

Download App Now   

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1. Home
2.  Services
3.  Lok Adalat

Lok Adalat
NALSA along with other Legal Services Institutions conducts Lok Adalats. Lok Adalat is
one of the alternative dispute redressal mechanisms, it is a forum where disputes/cases
pending in the court of law or at pre-litigation stage are settled/ compromised amicably.
Lok Adalats have been given statutory status under the Legal Services Authorities Act,
1987. Under the said Act, the award (decision) made by the Lok Adalats is deemed to be
a decree of a civil court and is final and binding on all parties and no appeal against such
an award lies before any court of law. If the parties are not satisfied with the award of the
Lok Adalat though there is no provision for an appeal against such an award, but they
are free to initiate litigation by approaching the court of appropriate jurisdiction by filing
a case by following the required procedure, in exercise of their right to litigate.

There is no court fee payable when a matter is filed in a Lok Adalat. If a matter pending
in the court of law is referred to the Lok Adalat and is settled subsequently, the court fee
originally paid in the court on the complaints/petition is also refunded back to the
parties. The persons deciding the cases in the Lok Adalats are called the Members of the
Lok Adalats, they have the role of statutory conciliators only and do not have any judicial
role; therefore they can only persuade the parties to come to a conclusion for settling
the dispute outside the court in the Lok Adalat and shall not pressurize or coerce any of
the parties to compromise or settle cases or matters either directly or indirectly. The Lok
Adalat shall not decide the matter so referred at its own instance, instead the same
would be decided on the basis of the compromise or settlement between the parties.
The members shall assist the parties in an independent and impartial manner in their
attempt to reach amicable settlement of their dispute.

Nature of Cases to be Referred to Lok Adalat

1. Any case pending before any court.

2. Any dispute which has not been brought before any court and is likely to be filed
before the court.

Provided that any matter relating to an offence not compoundable under the law shall
not be settled in Lok Adalat.
Which Lok Adalat to be Approached

As per section 18(1) of the Act, a Lok Adalat shall have jurisdiction to determine and to
arrive at a compromise or settlement between the parties to a dispute in respect of -

(1) Any case pending before; or

(2) Any matter which is falling within the jurisdiction of, and is not brought before, any
court for which the Lok Adalat is organised.

Provided that the Lok Adalat shall have no jurisdiction in respect of matters relating to
divorce or matters relating to an offence not compoundable under any law.

How to Get the Case Referred to the Lok Adalat for Settlement

(A) Case pending before the court.

(B) Any dispute at pre-litigative stage.

The State Legal Services Authority or District Legal Services Authority as the case may be
on receipt of an application from any one of the parties at a pre-litigation stage may
refer such matter to the Lok Adalat for amicable settlement of the dispute for which
notice would then be issued to the other party.

Levels and Composition of Lok Adalats:

At the State Authority Level -

The Member Secretary of the State Legal Services Authority organizing the Lok Adalat
would constitute benches of the Lok Adalat, each bench comprising of a sitting or retired
judge of the High Court or a sitting or retired judicial officer and any one or both of- a
member from the legal profession; a social worker engaged in the upliftment of the
weaker sections and interested in the implementation of legal services schemes or
programmes.

At High Court Level -

The Secretary of the High Court Legal Services Committee would constitute benches of
the Lok Adalat, each bench comprising of a sitting or retired judge of the High Court and
any one or both of- a member from the legal profession; a social worker engaged in the
upliftment of the weaker sections and interested in the implementation of legal services
schemes or programmes.

At District Level -
The Secretary of the District Legal Services Authority organizing the Lok Adalat would
constitute benches of the Lok Adalat, each bench comprising of a sitting or retired
judicial officer and any one or both of either a member from the legal profession; and/or
a social worker engaged in the upliftment of the weaker sections and interested in the
implementation of legal services schemes or programmes or a person engaged in para-
legal activities of the area, preferably a woman.

At Taluk Level -

The Secretary of the Taluk Legal Services Committee organizing the Lok Adalat would
constitute benches of the Lok Adalat, each bench comprising of a sitting or retired
judicial officer and any one or both of either a member from the legal profession; and/or
a social worker engaged in the upliftment of the weaker sections and interested in the
implementation of legal services schemes or programmes or a person engaged in para-
legal activities of the area, preferably a woman.

National Lok Adalat

National Level Lok Adalats are held for at regular intervals where on a single day Lok
Adalats are held throughout the country, in all the courts right from the Supreme Court
till the Taluk Levels wherein cases are disposed off in huge numbers. From February
2015, National Lok Adalats are being held on a specific subject matter every month.

Permanent Lok Adalat

The other type of Lok Adalat is the Permanent Lok Adalat, organized under Section 22-B
of The Legal Services Authorities Act, 1987. Permanent Lok Adalats have been set up as
permanent bodies with a Chairman and two members for providing compulsory pre-
litigative mechanism for conciliation and settlement of cases relating to Public Utility
Services like transport, postal, telegraph etc. Here, even if the parties fail to reach to a
settlement, the Permanent Lok Adalat gets jurisdiction to decide the dispute, provided,
the dispute does not relate to any offence. Further, the Award of the Permanent Lok
Adalat is final and binding on all the parties. The jurisdiction of the Permanent Lok
Adalats is upto Rs. Ten Lakhs. Here if the parties fail to reach to a settlement, the
Permanent Lok Adalat has the jurisdiction to decide the case. The award of the
Permanent Lok Adalat is final and binding upon the parties. The Lok Adalat may conduct
the proceedings in such a manner as it considers appropriate, taking into account the
circumstances of the case, wishes of the parties like requests to hear oral statements,
speedy settlement of dispute etc.

Mobile Lok Adalats are also organized in various parts of the country which travel from
one location to another to resolve disputes in order to facilitate the resolution of
disputes through this mechanism.
 As on 30.09.2015, more than 15.14 lakhs Lok Adalats have been organized in the country
since its inception. More than 8.25 crore cases have been settled by this mechanism so
far

STANDARD ASSETS
These assets do not carry more than normal risk which is attached to the
business and does not constitute any problem. These are not non-
performing assets.
NON-PERFORMING ASSETS

Non-performing assets are the assets that cease to generate any kind of
income for the banking company. The assets are categorized as non-
performing by applying some standard norms. Non-performing asset is a
loan or advance where:
 Interest or installment of principal remain overdue for a period of more than 90 days in respect of
term loan.
 The amount remains ‘out of order’ in respect of overdraft or cash credit.
 The bills remain overdue for a period of 90 days in the case of bills discounted or purchased.
 The installment of principal or interest thereon remains overdue for a crop season for long duration
crops.
 The installments of principal or interest thereon remains overdue for one crop season for long
duration crops.

The non-performing assets can be further classified into three categories:

SUB-STANDARD ASSETS

A substandard asset would be one which has remained Non-performing

asset for a period of more than or equal to 12 months. Sub-standard assets
are the assets which have well defined credit weaknesses that jeopardize
the liquidation of the debt and indicate that the banks will sustain loss in
case deficiencies are not corrected.
DOUBTFUL ASSETS

An asset would be classified as doubtful if it has remained in the sub-

standard category for a period of 12 months. These assets have the
probability of not getting encashed.
 LOSS ASSETS

A loss asset is one where loss has been identified by the bank or internal or
external auditors or by RBI inspection. But these assets are not allowed to
get written off completely.

INCOME RECOGNITION NORMS

 The policy of income recognition has to be objective and it should be based on the record of the
recovery. The banks should not charge and takes into account the income or interest on any non-
performing asset.
 Interest on advances against term deposits, national saving certificates etc. should be recognized on
accrual basis.
 Fees and commissions earned by the banks should be recognized on the accrual basis.
 Government guaranteed advances if became non-performing asset, the interest on such advances
should not be taken to income account unless the interest has been realized.

PROVISIONING NORMS
The provisioning norms regarding the assets identification as non-
performing are as follows:
 The statutory auditors and bank management have the primary responsibility for making provisions
or any decrease or dimunition in the value of loan assets, investments or other assets.
 Inspecting officer of RBI assist the bank management and statutory auditors in making decisions
regarding provisions.
 Provision for non-performing assets are to be made on the basis of classification of assets in
conformity with prudential norms.

By : commerceietsTags: INCOME RECOGNITION NORMS PROVISIONING NORMS

National Company Law Tribunal is the outcome of the Eradi Committee.

NCLT was intended to be introduced in the Indian legal system in 2002
under the framework of Companies Act, 1956 however, due to the litigation
with respect to the constitutional validity of NCLT which went for over 10
years, therefore, it was notified under the Companies Act, 2013.

It is a quasi-judicial authority incorporated for dealing with corporate

disputes that are of civil nature arising under the Companies Act. However,
a difference could be witnessed in the powers and functions of NCLT under
the previous Companies Act and the 2013 Act. The constitutional validity of
the NCLT and specified allied provisions contained in the Act were re-
challenged. Supreme Court had preserved the constitutional validity of the
NCLT, however, specific provisions were rendered as a violation of the
constitutional principles.

NCLT works on the lines of a normal Court of law in the country and is
obliged to fairly and without any biases determine the facts of each case
and decide with matters in accordance with principles of natural justice and
in the continuance of such decisions, offer conclusions from decisions in
the form of orders. The orders so formed by NCLT could assist in resolving
a situation, rectifying a wrong done by any corporate or levying penalties
and costs and might alter the rights, obligations, duties or privileges of the
concerned parties. The Tribunal isn’t required to adhere to the severe rules
with respect to appreciation of any evidence or procedural law.

Major Functions of NCLT

Registration of Companies

The new Companies Act, 2013 has enabled questioning the legitimacy of
companies because of specific procedural errors during incorporation and
registration. NCLT has been empowered in taking several steps, from
cancelling the registration of a company to dissolving any company. The
Tribunal could even render the liability or charge of members to unlimited.
With this approach, NCLT can de-register any company in specific
situations when the registration certificate has been obtained by wrongful
manner or illegal means under section 7(7) of the Companies Act, 2013.

Transfer of shares

NCLT is also empowered to hear grievances of rejection of companies in

transferring shares and securities and under section 58- 59 of the Act
which were at the outset were under the purview of the Company Law
Board. Going back to Companies Act, 1956 the solution available for
rejection of transmission or transfer were limited only to the shares and
debentures of a company but as of now the prospect has been raised
under the Companies Act, 2013 and the now covers all the securities which
are issued by any company. 

Deposits

The Chapter V of the Act deals with deposits and was notified several times
in 2014 and Company Law Board was the prime authority for taking up the
cases under said chapter. Now, such powers under the chapter V of the
Act have been vested with NCLT. The provisions with respect to the
deposits under the Companies Act, 2013 were notified prior to the inception
of the NCLT. Unhappy depositors now have a remedy of class actions suits
for seeking remedy for the omissions and acts on part of the company that
impacts their rights as depositors.

Power to investigate
As per the provision of the Companies Act, 2013 investigation about the
affairs of the company could be ordered with the help of an application of
100 members whereas previously the application of 200 members was
needed for the same. Moreover, if a person who isn’t related to a company
and is able to persuade NCLT about the presence of conditions for
ordering an investigation then NCLT has the power for ordering an
investigation. An investigation which is ordered by the NCLT could be
conducted within India or anywhere in the world. The provisions are drafted
for offering and seeking help from the courts and investigation agencies
and of foreign countries.

Freezing assets of a company

The NCLT isn’t just empowered to freezing the assets of a company for
using them at a later stage when such company comes under investigation
or scrutiny, such investigation could also be ordered on the request of
others in specific conditions.

Converting a public limited company into a

private limited company

Sections 13-18 of the Companies Act, 2013 read with rules control the
conversion of a Public limited company into the Private limited company,
such conversion needs an erstwhile confirmation from the NCLT. NCLT
has the power under section 459 of the Act, for imposing specific conditions
or restrictions and might subject granting approvals to such conditions.
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 CONTENTS

 Major Functions of NCLT

o Registration of Companies
o Transfer of shares
o Deposits
o Power to investigate
o Freezing assets of a company
o Converting a public limited company into a private limited company

ntext: An assessment of compliance with Basel Norms was recently conducted by

the Regulatory Consistency Assessment Programme (RCAP). RCAP is part of
the Basel committee.
The assessment focused on the completeness and consistency of the domestic
regulations in force on 7 June 2019, as applied to commercial banks in India,
with the Basel large exposures framework.
 
Background:
Basel Committee on Banking Supervision (BCBS) is the primary global standard
setter for the prudential regulation of banks, has 45 members, comprising central
banks and bank supervisors from 28 jurisdictions.
 
Key findings:

 The Reserve Bank of India’s (RBI) norms on large exposures for banks are not
only compliant with the Basel requirements, they are stricter in some areas
as well.
 This is highest possible grade. In some other respects, the Indian regulations
are stricter than the Basel large exposures framework. For example,  banks’
exposures to global systemically important banks are subject to stricter
limits, in line with the letter and spirit of the Basel Guidelines, and the scope
of application of the Indian standards is wider than just the internationally
active banks covered by the Basel framework.

 
What are Basel guidelines?
Basel guidelines refer to broad supervisory standards formulated by group of
central banks- called the Basel Committee on Banking Supervision (BCBS).
The set of agreement by the BCBS, which mainly focuses on risks to banks and the
financial system are called Basel accord.
Basel is a city in Switzerland which is also the headquarters of Bureau of
International Settlement (BIS).
The purpose of the accords is to ensure that financial institutions have enough
capital on account to meet obligations and absorb unexpected losses.
 
BASEL-I:
Introduced in 1988.
Focused almost entirely on credit risk, it defined capital and structure of risk
weights for banks.
The minimum capital requirement was fixed at 8% of risk-weighted assets
(RWA).
India adopted Basel 1 guidelines in 1999.
BASEL-II:
Published in 2004.
The guidelines were based on three parameters:

1. Banks should maintain a minimum capital adequacy requirement of 8% of risk

assets.
2. Banks were needed to develop and use better risk management techniques in
monitoring and managing all the three types of risks  that is credit and
increased disclosure requirements. The three types of risk are- operational
risk, market risk, capital risk.
3. Banks need to mandatory disclose their risk exposure to the central bank.

 
Basel III:
In 2010, Basel III guidelines were released. These guidelines were introduced in
response to the financial crisis of 2008.
Basel III norms aim at making most banking activities such as their trading
book activities more capital-intensive.
The guidelines aim to promote a more resilient banking system by focusing on
four vital banking parameters viz. capital, leverage, funding and liquidity.
Presently Indian banking system follows Basel II norms.