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‘Compromise Settlement Scheme’ reintroduced

Special Correspondent

To reduce non-performing assets, says PIPDIC

Puducherry: Pondicherry Industrial Promotion Development and Investment Corporation, an undertaking of Puducherry Government, has announced reintroduction of its “Compromise Settlement Scheme” for all loans classified as ‘non performing assets” as on March 31, 2006.

A release from its Managing Director said here on Tuesday that the arrangement was to reduce the NPAs and help eligible industrial units and borrowers to settle their loans. This was done in keeping with the announcement made by Industries Minister V. Vaithilingam in the Assembly in the budget session.

The settlement amount payable by the NPA accounts had been classified under three divisions based on the remittance of interest. If the interest was more than the principal amount, the settlement amount payable would be “principal outstanding and other expenses plus 10 per cent of the interest due as on March 31, 2007”.

For the second category, which relates to units that had remitted interest between 50 per cent and 100 percent of the principal amount, the settlement amount payable would be “principal amount outstanding and other expenses plus 25 per cent of interest due payable as on March 31, 2007”.

If the interest amount remitted by industries was less than 50 per cent, the settlement amount payable in such cases would be “principal outstanding and other expenses plus 50 per cent of interest payable as on March 31, 2007”. This scheme would be in operation till 2007 end. The release added that to become eligible under the scheme, the industrial units and borrowers would have to pay 30 per cent of the outstanding principal amount on or before August 31. Balance settlement amount should be settled on or before December 31 this year.

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