[Amogh Sharma is a B.A L.L.B (Hons.) student at HNLU Raipur] On 30 August 2019, the Ministry of Corporate Affairs (MCA) had constituted a Committee of Experts to examine the need for an institutional framework to regulate and develop valuation as a profession. On the basis of the Committee’s recommendation, a Draft Valuers Bill, 2020 has been drafted to establish a National Institute of Valuers...
The Game of Jurisdictions: Arbitration and Insolvency Proceedings
[Kunal Dey is an Associate at Argus Partners, Kolkata] The Arbitration and Conciliation Act, 1996 has undergone significant changes as a result of the Arbitration and Conciliation (Amendment) Act, 2015. However, before the contours of the amendments (brought into effect on 23 October 2015) could be established by the courts, the Insolvency and Bankruptcy Code, 2016 (IBC) was introduced into the...
Super Priority Financing: An Opportunity in a Crisis
[Apoorva Upadhyay and Parthsarthi Srivastava are 3rd year BBA.LL.B students at National Law University Odisha] As the economic conditions continue to deteriorate, several corporations will likely turn to file for bankruptcy protection in the near future. One of the most sought after alternatives for such distressed companies would be access to capital to ensure minimum liquidity and continuation...
Revisiting Corporate Insolvency: An Empirical Case for Protection of Operational Creditors
[Surbhi Soni is a third year student at the National Law School of India University, Bangalore] The Insolvency and Bankruptcy Code 2016 adopts the conventional court-mediated contract enforcement mechanism for debt resolution and restructuring of a corporate debtor. The basic principle of such resolution is that it mirrors the application of a predetermined (or ex ante) contractual bargain...
Withdrawal of Resolution Plans due to Covid-19: A Legal Analysis
[Sikander Hyaat and Sara Jain are 5th year B.A., LL.B. (Hons.) students at MNLU Mumbai] The outbreak of the coronavirus pandemic has caused substantial market disruptions and deterioration of consumption. Recently, the Fitch Ratings has reduced India’s GDP growth forecast from 5.1% to 2%, making it the slowest growth rate over the past 30 years. Consequently, businesses are facing severe...
Section 61 of the IBC: A Case for Contextual Statutory Interpretation
[Hitoishi Sarkar and Yash More are II year students at Gujarat National Law University, Gandhinagar] Section 61 of the Insolvency and Bankruptcy Code, 2016 provides for appeals from the National Company Law Tribunal (NCLT) to the National Company Law Appellate Tribunal (NCLAT). However, section 61 does not mention, in express terms, any details regarding the mechanism for calculating the...
Amendment to the Threshold of Default under the Insolvency Code: Some Drafting Concerns
[Rohan Deshpande practices as a counsel at the Bombay High Court, and would like to thank Mihir Naniwadekar for his comments on a draft version] Section 4 of the Insolvency and Bankruptcy Code, 2016 sets out the threshold of default for the purpose of invocation of insolvency proceedings under the Code. If a corporate debtor commits a default in repayment of debt towards a financial or an...
Rajasthan High Court on Prior-period Claims in Resolution Plans
[Megha Mittal and Shreya Jain are Associates at Vinod Kothari & Co.] A resolution plan under the Insolvency and Bankruptcy Cody, 2016 is the revival route for a corporate debtor, free of its past liabilities and dues, paid in accordance with the approved plan. Having said so, it might be noted that resolution plans assume the status of a statutory binding contract once approved by the...
Covid-19 Crisis: Analyzing the Reforms to Insolvency and Bankruptcy Laws
[Karan Sahi is a corporate lawyer and company secretary by profession, and Pranay Bhattacharya is a 3rd year BA LLB (Hons.) student at the Maharashtra National Law University, Aurangabad] The changing market dynamics from the coronavirus (“Covid-19”) has impacted almost every sector. The pandemic has not only caused global business disruption by halting the international trade, it has also...
The (Active) Involvement of Directors during Insolvency Proceedings
[Kushagra Srivastava is a 3rd year B.A.L.L.B. (Hons.) student at National Law Institute University, Bhopal] Section 17(1)(a) of the Insolvency and Bankruptcy Code, 2016 (the “Code”) vests the management of the affairs of a corporate debtor in the interim resolution professional (“IRP”) on the insolvency commencement date in accordance with section 16 of the Code. This implies the imposition of...
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