Now, a start-ups' insolvency process to be completed in 90 days

Govt notifies fast-track resolution code for corporates; decision to largely benefit start-ups

The government on Friday notified provisions for fast-track resolution of insolvency proceedings in what will come as major relief to struggling start-ups.

Under this part of the code, also applicable to small companies, insolvency proceedings will be completed in 90 days. 

According to industry data, around 95 per cent of start-ups are unsuccessful ventures and wind down within two years of operations. However, liquidation of the companies is a painful process that takes at least five years. 

The main code formulated for insolvency proceedings mandate a firm’s restructuring or exit within 180 days from the day of admission.

The adjudicating