Suspension of IBC can affect resolution efforts and shift focus to recovery

“A lot can change in a year. The progress under the Insolvency and Bankruptcy Code (IBC), in terms of credit discipline and resolution, could be at risk of being compromised,’’ says Divyanshu Pandey, Partner at J Sagar Associates.

On Wednesday, the Union Cabinet gave approval to the suspension of the IBC for Covid-19-related stress. It was decided to hold in abeyance Sections 7, 9 and 10 of the IBC by introducing Section 10A for six months which could be extended up to a year. While only pandemic-related cases will get the benefit of this reprieve, it will be tough to