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Srei Infrastructure Finance Limited

NBFC

The RBI action, regulatory basis, and operating impact linked to this entity.

Recorded RBI impact

Board supersession

Board supersession · Fresh imposition

S5

Published by RBI

4 Oct 2021

Case Brief

The Reserve Bank of India superseded the Boards of Directors of Srei Infrastructure Finance Limited and Srei Equipment Finance Limited under Section 45-IE(1) of the RBI Act, 1934. RBI cited governance concerns and defaults by the two NBFCs in meeting their payment obligations. Shri Rajneesh Sharma, former Chief General Manager, Bank of Baroda, was appointed Administrator under Section 45-IE(2). RBI also said it would soon begin resolution proceedings under the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority) Rules, 2019 and would apply to NCLT to have the Administrator appointed as Insolvency Resolution Professional.

Why RBI Acted

Governance oversightOther

In exercise of powers under Section 45-IE(1) of the RBI Act, 1934, RBI superseded the Board of Directors of Srei Infrastructure Finance Limited and Srei Equipment Finance Limited. The action was taken owing to governance concerns and defaults by the companies in meeting their various payment obligations. RBI also appointed Shri Rajneesh Sharma as Administrator under Section 45-IE(2) and stated it would shortly initiate resolution proceedings under the Insolvency and Bankruptcy Rules, 2019, including an application to NCLT for appointment of the Administrator as Insolvency Resolution Professional.

Operating Impact

The two NBFCs lose board control and are placed under an Administrator, with RBI moving toward insolvency-resolution proceedings. This affects the companies’ management, creditors, and other stakeholders, and may lead to formal resolution or liquidation processes under the IBC framework.

Regulatory Basis

  • Section 45-IE (1) of the Reserve Bank of India Act, 1934
  • Section 45-IE (2) of the RBI Act

Action Facts

Primary Impact
Board supersession
Effective From
1 Oct 2021
Entities Affected
2
Entity Role
Primary
Entity Type
NBFC

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    1 shared action

    1 restriction