Define the following terms : Wilful default

During due diligence for banks, a Practicing Company Secretary also checks if the name of the company or any of its directors appears in the defaulters' list of the Reserve Bank of India. A 'wilful default' would be deemed to have occurred if any of the following events is noted: Capacity to Pay but Default: The company has defaulted in meeting its payment/repayment obligations to the lender even when it has the capacity to honour the said obligations. Diversion of Funds: The company has defaulted in meeting its payment/repayment obligations to the lender and has not utilised the finance from the lender for the specific purposes for which finance was availed of but has diverted the funds for other purposes. Siphoning Off Funds: The company has defaulted in meeting its payment/repayment obligations to the lender and has siphoned off the funds so that the funds have not been utilised for the specific purpose for which finance was availed of, nor are the funds available with the unit in the form of other assets. To prevent wilful defaulters from accessing capital markets, the RBI forwards a copy of the list of wilful defaulters (non-suit filed and suit-filed accounts) to SEBI and Credit Information Bureau (India) Ltd. (CIBIL).