[Bhavin Gada is a Partner at Economic Laws Practice, Advocates and Solicitors (“ELP”), and Manendra Singh an Associate Manager at ELP. The authors would like to thank Akshata Limaye, Associate at ELP, for her inputs] The corporate insolvency resolution process (CIRP) for corporate persons under the Insolvency and Bankruptcy Code, 2016 (Code) was introduced with the primary objective of providing...
Recovery Proceedings against Guarantors during the Insolvency of the Principal Debtor
[Milind Gaur is a 5th Year BBA LLB student of Symbiosis Law School, Pune.] Introduction With the dawn of the Insolvency and Bankruptcy Code, 2016 (the Code), a crucial and much needed framework was set in place for tackling the insolvency and bankruptcy regime in India. At the same time, the Code has elicited clarifications and interpretation across various provisions. One such question which...
Applicability of the Limitation Act to Insolvency Proceedings: A Critical Analysis
[Madhumitha Srinivasan is an Associate at Advaya Legal and practising in the Bombay High Court. The views expressed are personal. An earlier post on the topic is available here] In a decision passed by the National Company Law Appellate Tribunal (NCLAT) in Black Pearl Hotels Pvt. Ltd. vs. Planet M Retail Ltd. (judgment dated 17 October 2017), it has been observed that the right to apply under the...
Ordinance to Amend the Insolvency and Bankruptcy Code Promulgated
In recent weeks, there has been an intense debate, including on this Blog, about whether promoters (particularly those broadly considered wilful defaulters) must be allowed to bid for assets being sold as part of the resolution plan for a debtor company under the Insolvency and Bankruptcy Code, 2016 (the “Code”). This debate was sparked partly by certain transparency norms introduced by the...
Undue Emphasis on Certificate from a Financial Institution under Insolvency Law
[Aayush Mitruka is a lawyer based in Delhi] The working of the Insolvency and Bankruptcy Code, 2016 (Code) has given rise to several challenges which need to be adequately addressed. The Code enables an operational creditor to initiate a corporate insolvency resolution process (CIRP) under section 9 provided it has complied with the requirement of sending a demand notice to the corporate debtor...
Settlement under the Insolvency and Bankruptcy Code, 2016: A Contrarian Perspective
[Shaleen Tiwari is an Advocate, Bombay High Court and a graduate of Hidayatullah National Law University, BA.LLB (Hons.), 2016] This post represents a contrarian view to the one adopted in a November 17, 2017 post titled ‘The Jeopardy of Settlements in Insolvency Cases’. Forming the cornerstone of the discussion here is the recent Supreme Court order in Uttara Foods and Feeds Private Limited v...
The Jeopardy of Settlements in Insolvency Cases
[Shreya Prakash is a BCL student at the University of Oxford. Earlier posts on the topic can be found here and here.] The Supreme Court in a recent order recommended that the Insolvency and Bankruptcy (Application to the Adjudicating Authority) Rules, 2016 be amended to allow for settlement between an individual debtor and creditor after an insolvency petition has been accepted. With respect...
The Ability of Promoters to Bid for their Own Companies in Insolvency
[Anupam Choudhary is an Associate at Agram Legal Consultants, a law firm based in Mumbai. The views and opinions expressed are those of the author and do not reflect the view of his firm nor do they constitute legal opinion] Recently, there has considerable debate over whether promoters of insolvent companies can submit bids in the bidding process for their own companies. Recently, the Essar...
The (Negligible) Role of Shareholders in Corporate Insolvency
The Ministry of Corporate Affairs (MCA) yesterday issued a clarification stating that no resolution or approval of the shareholders of a debtor company will be required in order to give effect to a resolution plan under the Insolvency and Bankruptcy Code, 2016 (IBC). It appears that stakeholders sought the MCA clarification on account of section 30(2)(e) of the IBC, which requires the resolution...
The Curious Case of Homebuyers under the Insolvency and Bankruptcy Code, 2016
[Manaswi Agarwal is an advocate based in Mumbai and Aayush Mitruka is an advocate based in New Delhi] One of the crucial issues which has emerged and is widely talked about under the Insolvency and Bankruptcy Code, 2016 (Code) relates to the interest of homebuyers under the Code. The jurisprudence developing around the Code does not adequately address their concerns, and therefore the law...
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