Tag: Insolvency
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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…
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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.…
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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…
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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…
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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…
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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,…
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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.…
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IBC Threshold Raised: Analysis and Implications
[Megha Mittal and Shreya Jain are Associates at Vinod Kothari & Co.] The seemingly low threshold of Rs. 1,00,000 for the initiation of insolvency proceedings has been a persistent concern given the possibility of its exploitation by frivolous actions. While rumours about raising the threshold limit for initiating insolvency process have long been swirling, the…
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Position of Third Party Security after Jaypee Infratech
[Ankesh Kumar is a IV Year student at NLIU Bhopal] Anuj Jain v Axis Bank Limited witnessed the Supreme Court ruling on two important matter in Indian insolvency law. As summarized in this post, while the Court set aside the transactions in question as being preferential within the meaning of section 43 of Insolvency and…
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IBC Ordinance, 2019: Impleadment of Allottees in a Pending Application
[Pareekshit Bishnoi is an advocate based in Delhi] The President of India on 28 December 2019 promulgated the Insolvency and Bankruptcy Amendment (Ordinance) Act, 2019 (the “Ordinance”) to amend several provisions of the Insolvency and Bankruptcy Code, 2016 (the “Code”). Pertinently, section 3 of the Ordinance amended section 7 of the Code by adding three…
