A year ago, the banks were given tough new powers to foreclose on the assets of bad debtors under new legislation known as the "securitisation law". But this has now been challenged.
Gujarat-based Mardia Chemicals has secured a restraint order blocking attempts led by ICICI Bank, India's second-largest financial institution, to foreclose on the company's debts.
The move by Mardia, which owes Rs14.5bn (US$316m) to 22 Indian lenders, has effectively delayed any further foreclosure efforts by banks until the Supreme Court hands down a ruling - with the next hearing expected within a few days and a final judgment within the current financial year.
