PSUs Current Affairs
State-owned aerospace and defence manufacturer Hindustan Aeronautics (HAL) became the first public sector enterprise (PSU) to make transaction on RXIL TReDS platform. It executed its first digitised invoice discounting transaction on RXIL TReDS platform by accepting digital invoice uploaded by Nasik-based MSME (micro category) vendor Narendra Udyog. This transaction was financed by Bank of Baroda.
RXIL- TReDS platform
TReDS is online electronic institutional mechanism for facilitating the financing of trade receivables of micro, small and medium enterprises (MSME) through multiple financiers. RXIL is India’s first TReDS platform operating since January 2017. It promoted by National Stock Exchange (NSE), Small Industries Development Bank of India (SIDBI), State Bank of India (SBI), ICICI Bank and Yes Bank. It enables MSMEs to gain control of their receivables with enhanced visibility and timeliness. In October 2017, Union Government had mandated all major PSUs to join TReDS platform to facilitate payments to MSME (micro, small and medium enterprises) vendors.
Union Cabinet has approved strengthening commercial disputes resolution mechanism of Central Public Sector Enterprises (CPSEs) inter se and also between CPSEs and other Government Departments and Organizations. The Cabinet decision is based on recommendations of Committee of Secretaries (CoS).
The new strengthened mechanism puts in place institutionalized mechanism within Government for speedy resolution of commercial disputes of CPSEs without matter being referred to the Courts of law. It consists of new two-tier mechanism to resolve commercial disputes between CPSEs outside Courts of law.
It replaces existing Permanent Machinery of Arbitration (PMA) mechanism and excludes disputes concerning Railways, Income Tax, Custom and Excise Departments from its ambit. It will promote equity through mutual and collective efforts to resolve commercial disputes thereby reducing number of litigations regarding commercial disputes in Court of Law and also avoid wastage of public money.
New two-tier mechanism
First level (tier): Such commercial disputes will be referred to a committee comprising secretaries of the administrative ministries to which the disputing parties belong and Law Secretary. The financial advisors of two ministries concerned will represent issues related to dispute in question before the committee.
In case the two disputing parties belong to same ministry, then committee will comprise secretary of administrative ministries concerned, Law Secretary and Secretary, Department of Public Enterprises. In such case, the matter will be represented by financial advisor and one joint secretary of that ministry. For the prompt disposal of disputes, 3 months’ time schedule at this level has been prescribed.
Second level (tier): In case dispute remains unresolved, even after consideration by above Committee in first tier, it will be referred to Cabinet Secretary, whose decision will be final and binding on all concerned.