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NCLT needs clear set of protocols to flatten bankruptcy curve, say experts

Debt restructuring schemes under company law, and introduction of Code-based pre-packs are worth exploring, say experts

Coronavirus | Insolvency and Bankruptcy Code | Lockdown

Sudipto Dey 

Illustration: Ajay Mohanty
Experts say there is no outer date for the completion of a scheme of arrangement. Illustration: Ajay Mohanty

The temporary suspension of insolvency applications on lockdown-induced defaults has put the spotlight on the corporate debt restructuring schemes in the company law, and the introduction of (IBC)-oriented pre-packs. Experts, however, are divided on the efficacy of these schemes in their current form. For the alternative debt resolution mechanism to be effective, the Act, 2013, and the Code need to be amended, they argue.



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First Published: Sun, June 07 2020. 19:43 IST