'India's legal framework should be ready for eco development challenges'

National Company Law Appellate Tribunal Chairman Ashok Bhushan on Saturday said the country's legal framework must be robust enough to handle the challenges that come with economic development.

The Insolvency and Bankruptcy Code, 2016 (IBC) unveiled by the Centre is a significant step in that direction, Bhushan said at the inauguration of the renovated court premises of NCLAT Chennai Bench by Union Finance Minister Nirmala Sitharaman here.

The IBC is a comprehensive legislation that seeks to address the issue of insolvency and bankruptcy holistically. It is aimed at protecting all the stakeholders and also seeks to promote entrepreneurship by providing a more streamlined and efficient process for resolving insolvency, he said.

"Former Union Minister of Finance the late Arun Jaitley pioneered the enactment of Insolvency and Bankruptcy Code in 2016. India's economy is the fastest growing in the world and as it grows it must ensure that its legal framework is robust enough to handle the challenges that come with economic development," the justice said.

He maintained that the NCLAT has settled several issues with precision imparting clarity to the insolvency resolution process through 'landmark judgements.'

The Central government has demonstrated a proactive approach by bringing successive amendments and the government is taking steps by adding more NCLAT benches and number of courts in the country, he said.

"Today it is recognised universally that the Indian legal framework for resolution of insolvency has emerged as a formidable mechanism unparalleled in the contemporary world," he said.

Bhushan said in the global regulation index, India has improved its position to an impressive 63rd in 2022 from the earlier 130th in 2016.

"Resolving insolvency is an important constituent of overall ranking under the ease of doing business and India has leapfrogged to 52 in 2022 from 136 in 2016," he pointed out.

He said in 2022, the NCLAT Chennai bench disposed 264 company appeals of the total 578 total cases.

"Due to the increasing number of cases being filed under IBC, I take this opportunity to request Union Finance Minister (Nirmala Sitharaman) to consider increasing the strength of members by at least one more judicial and technical member so that another court can be made available at Chennai for speedy disposals," he said.

Two courts were renovated in the NCLAT Chennai and currently only one was functioning, he said.

On the performance of NCLAT Principal Bench, he said in 2022 the total number of cases filed was 1,844 and the total number of cases disposed off were 2,015 which was higher than the number of cases filed.