The Insolvency and Bankruptcy Code, 2016 (IBC) marks a significant milestone in the realm of insolvency and bankruptcy resolution in India. With its passage by Parliament and Presidential assent on May 28, 2016, the IBC revolutionized the legal framework surrounding insolvency and bankruptcy.
The Insolvency and Bankruptcy Code, of 2016 introduced a paradigm shift in India’s corporate legal landscape. One of its most significant features is the overriding effect it has on other laws.
The Bangalore Sales Corporation v Sark Spice Products Pvt. Ltd., the National Company Law Tribunal (“NCLT”), Kochi Bench, comprised of Shri. P. Mohan Raj (Judicial Member) and Shri. Satya Ranjan Prasad (Technical Member), held that an unregistered Partnership Firm cannot institute insolvency proceedings under IBC.
For India’s distressed debt, the Insolvency and Bankruptcy Code 2016 (IBC) was a game-changing change. It developed a tool to revitalize struggling distressed debtors, heralding a shift from previous resolution and recovery methods.
The enforcement proceedings for the foreign award (under S. 47-48) are the last and final stage where the debtor can resist the award from becoming binding/ enforceable for grounds listed under Section 48 of the Arbitration Act.
Cheque bouncing is also the default in making payment of debt, and petition under IBC laws may be admitted
The code is not applicable to corporates in finance sector. Thus no petition shall be entertained by NCLT filed against Banks, Financial Institutions, Insurance Company, Asset Reconstruction Company, Asset Reconstruction Company, Mutual Funds, Collective Investment Schemes or Pension Funds.
Initiation process of Insolvency Resolution by a financial creditor in the easiest possible manner along with the time line that is required to be followed.
The NCLT has suggested to IBBI that there is a need to review the insolvency code regulations to ensure that they are not “misused or misinterpreted”.
Amongst the 11 high profile case under the purview of Insolvency Code, Essar Steel has attracted a lot of attention.
The scheme as provided under the Code stipulates a mechanism wherein the Insolvency Resolution Process is reckoned upon any default upon non-payment of debt due.
The regulator is planning to come out with a discussion paper on compliance with SEBI standards by listed companies undergoing insolvency resolution process.
In this article we have discussed about the procedures of filing a case before NCLT and the required documents.
The recent judgment of the Apex Court in the case of Safire Technologies (Supra) simply expands this explanation to Section 61 of the IBC and discards the contentions that the time period for the limitation shall start running from the date of knowledge of the order.
The IBC (Amendment) Bill 2017 was passed by the Lok Sabha to form the base for covering loopholes in prevailing code and to increase the effectiveness of the resolution.
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