Govt-owned enterprises may soon face the IBC heat

For first time, 9 PSBs have taken a state-owned enterprise to task

Till now, private corporate debtors have been at the receiving end of the Insolvency and Bankruptcy Code. That may soon change with the first state-owned enterprise going through the insolvency process. This may set the ball rolling for similar instances of defaulting government-owned enterprises being taken to task by financial and operational creditors, said experts. 

In a case testing the statutory powers vested with creditors under the Insolvency and Bankruptcy Code (IBC), insolvency resolution proceedings were initiated against West Bengal Essential Commodities Supply Corporation (WBECSC), a state-government undertaking that is in the business of procuring and distributing food grains and essential