The government has proposed a number of changes to the insolvency law, including fast-tracking the process and expanding the scope of pre-packaged framework. Since the enactment of the Insolvency and Bankruptcy Code (IBC) in 2016, it has already undergone various amendments.
The government said, “To strengthen the functioning of the IBC, changes to the Code are being considered in relation to the admission of corporate insolvency resolution process applications, streamlining the insolvency resolution process, recasting the liquidation process, and the role of service providers under the Code.”
The proposed changes include redesigning the fast-track corporate insolvency resolution process to permit financial creditors to drive the insolvency resolution process for a corporate debtor outside of the judicial process.
Among other changes, the corporate affairs ministry has suggested developing a state-of-the-art electronic platform for handling several processes under the Code with minimum human interface.
The ministry said, “It may also allow regulators and the AAs to exercise better oversight over their respective domains of functioning through the consolidated information available on the e-platform.”
Besides, the government also proposed to amend section 10 to delete the right of the corporate debtor to propose an insolvency professional. In such instances, the insolvency professional should be appointed by the adjudicating authority on the recommendation of the insolvency and bankruptcy board of India (IBBI), the government said.
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