They are willful defaulters in banks’ books as they have been unwilling to honour their payment obligations even while having a capacity to do so. Some of the promoters have diverted borrowed funds for purposes other than for which the finance was availed.
There are also occasions where some of the borrowers have siphoned off funds for personal gains and not created any productive asset. A section of the promoters have also disposed off movable fixed assets or immovable property given for the purpose of securing a term loan without the knowledge of the lender.