IBC's blind spot: Rights of operational creditors need to be spelt out

Although the IBC allows operational creditors to invoke the insolvency resolution process, the cases of L&T and Ericsson reflect the unanticipated variables in the mix

As the first exercise of its kind in India, the Insolvency and Bankruptcy Code (IBC) has been a work in progress, entailing periodic adjustments to the rules as unforeseen issues come to the fore in settlement proceedings. These issues oblige the National Company Law Tribunal (NCLT) and the National Company Law Appellate Tribunal (NCLAT) to create a body of precedents and settled law for the smooth functioning of the debt recovery process, which has become critical to kick-start the economy. Earlier, the rules were tweaked to bar promoters from bidding for the own companies under the IBC, as also those