The circular also withdrew the loan resolution mechanisms the RBI had implemented, such as Corporate Debt Restructuring and Strategic Debt Restructuring.Power sector was the worst hit by the circular and so were companies in steel, textile, sugar and shipping sector.GMR Energy Ltd, RattanIndia Power Ltd, Association of Power Producers (APP), Independent Power Producers Association of India, Sugar Manufacturing Association from Tamil Nadu and a shipbuilding association from Gujarat moved wholesale pure sine wave inverter for sale different courts against the circular.The power sector argued that outstanding loans of Rs 5.65 lakh crore (as on March 2018) were a result of factors beyond their control such as unavailability of fuel and cancellation of coal blocks.The Supreme Court Tuesday held that the circular was ultra vires -- meaning it went beyond the scope of what the RBI can do when coming up with rules and regulations.Mukerjee said the Supreme Court verdict along with recent government decisions implementing the recommendations of the High-Level Empowered Committee will provide much needed respite and impetus to regulatory reform in the power sector.

　　New Delhi: The government may launch a new Rs 18,000 crore subsidy scheme for stressed gas-based power projects that will enable these fuel starved plants to run using a mix of domestic and imported gas. The move is expected to benefit 31 stranded projects worth 15,000 MW belonging to Essar Power, Torrent Power, GSPC, Reliance Infra, GMR, GVK, NTPC and Lanco. Another 10,000 MW of projects running but at lower load factor of 25-30 per cent could also take advantage of the scheme. The new scheme would be akin to the eRLNG (electronic regassified liquefied natural gas) scheme that helped 31 stranded power projects to restart operations using imported gas two years back. This scheme ran for two years between 2015 and 2017 and got financial support from the Power System Development Fund.Sources said that power and petroleum ministry has begun work on drafting the new subsidy scheme after an empowered committee headed by cabinet secretary PK Sinha favoured revival of the eRLNG scheme to support stranded gas-based power projects that represents an investment of over Rs 60,000 crore, which is at the threshold of becoming non performing assets.

　　ICRA senior vice president Sabyasachi Majumdar said the Supreme Court decision is likely to result in a further slowdown in the already tardy pace of resolution of stressed assets in the power sector."This apart, the resolution process is in any case subjected to regulatory risks as exemplified in the case of the Prayagraj Power asset, where the regulator has given a recent directive for a discount in PPA tariff while allowing the shareholding change approval for the same," he said.The RBI had on February 12, 2018, issued a circular on the resolution of stressed assets revised framework -- commonly known as February 12 circular.According to the circular, lenders had to classify a loan account as stressed if there was even a day of default. The bankers had to mandatorily refer all accounts with over Rs 2,000 crore loans to the National Company Law Tribunal (NCLT) or the bankruptcy court if they failed to resolve the problem within 180 days of default.Lenders were supposed to file an insolvency application under the Insolvency and Bankruptcy Code 2016 within 15 days of the completion of the 180-day deadline.