Difference between Insolvency and Bankruptcy

Insolvency is just the state where the financial inability is reached whereas the bankruptcy is the realization and announcement of that the state of being insolvent.

Persons upon whom the Insolvency code is applied

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.

Inordinate delays demolishing the purpose of Insolvency Code

The Essar Steel matter has raised a valid and crucial point of inordinate delays which is a big concern as it was the important provision of IBC, time bound resolution. If this purpose fails, the whole motive of IBC will fall apart.