Page 13 - Insolvency And Bankruptcy Code

Government may implement 2-month asset freeze of airlines under insolvency

To prevent immediate repossession of aircraft by lessors after default, the government is contemplating a two-month moratorium rule for the aviation sector

Centre likely to review IBC Bill only after 2024 general elections

The decision to revisit the proposed amendment Bill is also in the backdrop of frequent amendments that the IBC has undergone since its introduction in 2016. The law has been changed six times so far

JSL gets board approval to acquire Rabirun Vinimay for Rs 96 crore

Jindal Stainless Limited (JSL) on Tuesday said its board of directors has approved the acquisition of Rabirun Vinimay Private Ltd which is under liquidation. The cost of the acquisition is Rs 96 crore, JSL said in a regulatory filing. "The Board of Directors accorded its consent for acquisition of 100 per cent stake in Rabirun Vinimay Private Limited (RVPL), a company under liquidation, on a going concern basis, in terms of the applicable provisions of Insolvency and Bankruptcy Code, 2016," it said. JSL said RVPL has potential downstream cold-rolling manufacturing capacity of 250 KTPA (kilo tonne per annum) for wider and thinner segment besides having a capacity of 50 KTPA for pipe and tube segment. Its plant is located at Vidyasagar Industrial Park, Kharagpur, West Bengal over 60 acres of land area. The plant is currently shut down. "The proposed acquisition would complement the management's objective of increasing the cold-rolling capabilities of going thinner with wider width to

Lanco Amarkantak Power creditors to vote on Adani Power's Rs 4,100 cr bid

An unsolicited bid of Rs 3,650 crore was submitted by Adani Power, which was later improved to Rs 4,100 crore

NCLT rejects insolvency plea against SpiceJet by lessor Willis Lease

In a relief to low-cost carrier SpiceJet, the National Company Law Tribunal (NCLT) on Monday dismissed an insolvency petition by aircraft lessor Willis Lease Finance Corporation which is claiming dues. A two-member Delhi-based NCLT bench rejected the plea moved by US-based Willis Lease Finance Corporation after SpiceJet questioned the maintainability of the petition. SpiceJet opposed the plea contending that Willis Lease Finance Corp has withdrawn its insolvency plea for the same dispute in March 2023 and has approached again with a new plea. During a hearing in July this year, the NCLT bench wanted to know from Willis Lease Finance Corp, as to how it filed a fresh petition again for a similar cause of action within a few months, without even sending a notice to SpiceJet as per the provisions of the Insolvency and Bankruptcy Code, 2016. Besides Willis Lease, SpiceJet is facing insolvency pleas filed by three other aircraft lessors -- Aircastle Ireland Ltd, Wilmington, and Celestial

Centre says over 106,000 companies voluntarily exited in last five years

More than 1 lakh firms voluntarily exited under the companies law in nearly five years, the government said on Monday. Besides, many companies have sought voluntary liquidation under the Insolvency and Bankruptcy Code (IBC). "From FY 2018-19 to FY 2023-24 (up to 30th November, 2023) 1,06,561 companies have exited voluntarily under section 248(2) of the Companies Act, 2013. "From FY 2018-19 to FY 2023-24 (up to 30th September 2023) final reports of 1,168 companies have been submitted by liquidators under section 59 of the Insolvency and Bankruptcy Code, 2016 (Code), of which final dissolution orders have been passed by NCLT in 633 cases during the said period," Union Minister Rao Inderjit Singh told the Lok Sabha. Section 248(2) of the Companies Act pertains to voluntary exit of companies while Section 59 of the IBC relates to voluntary liquidation of companies. In the last five years, Singh said the time taken for voluntary exit under Section 248(2) of the Companies Act, 2013 has

IBC has been revolutionary, but it's time for improvement and tweaks

Insolvency cases remain pending for months and years, deterring stakeholders. It is imperative that litigation be reduced

Guaranteeing personal guarantees

Through its recent judgment the apex court has rescued the institution of surety

IBC recoveries declining, resolution timelines getting prolonged: Crisil

Introduction of a focused bankruptcy law has helped improve the credit culture in India, but the last few years have seen a decline in recoveries and the resolution timelines getting prolonged, Crisil Ratings on Friday. In a note to observe the seven years of the Insolvency and Bankruptcy Code (IBC), the rating agency said the recovery rates have fallen to 32 per cent in September 2023, from 43 per cent in March 2019. At the same time, the average resolution time has increased from 324 days to 653 days, versus the stipulated 330 days, it said. The IBC has helped in resolving debt worth Rs 3.16 lakh crore stuck in 808 cases in the past seven years, the leading credit rating agency said. Its senior director Mohit Makhija said the IBC is "the most potent code" in India's corporate loan history, which has brought a "behavioural change" in borrowers. "The fear of losing companies has led to over Rs 9 lakh crore of filed debt being settled before the cases arrived at the IBC doorstep fo

NCLT extends insolvency process of grounded airline Go First by 90 days

The tribunal has also asked the resolution professional (RP) of the airline to submit a 90-day action plan

Go First lenders to vote on liquidation amid lack of suitors: Report

The proposal whether or not to liquidate the airline has been floated and with individual lenders will take the proposal to their boards and submit final votes in 10-15 days, the report said

Manufacturing tops insolvency cases, real estate a close second

The recovery rate from personal guarantors currently stands at 5.22%. This rate is anticipated to rise following the Supreme Court's recent ruling affirming the constitutionality of the IBC provisions

Recovery rate from personal guarantors may rise: CareEdge Ratings

The Supreme Court upheld the constitutionality of IBC provisions on Personal Guarantors' Insolvency Resolution, dismissing over 200 petitions which challenged its legal validity

Adani, JSW Cement, and ArcelorMittal eyeing Vadraj Cement in IBC Sale

The Bombay High Court ordered the winding up of Vadraj Cement in August 2018, leading to the decision to sell the company under the IBC process

IIM Ahmedabad study finds significant improvement in firms post IBC

The study found that hotels and restaurants have had the highest recovery rate for creditors under the IBC while electricity, gas, and water supply firms have the lowest recovery rates

Future Retail's resolution professional files for liquidation before NCLT

The Corporate Insolvency Resolution Process (CIRP) was initiated against Future Retail by its lender Bank of India (BOI) following loan defaults

Insolvency and Bankruptcy Code: Personal guarantors get no SC reprieve

More than 200 petitions, including by Anil Ambani, challenged law on due process

SAT partially upholds market regulator Sebi order in Deccan Chronicle case

In May 2022, Sebi had issued an order alleging manipulation in financials, lapses in buyback procedures, and failure to submit disclosures on material information

SC upholds validity of key provisions of Insolvency and Bankruptcy Code

The Supreme Court on Thursday upheld certain key provisions of the Insolvency and Bankruptcy Code (IBC) amid the claim of several petitioners that that they are violative of fundamental rights like the right to equality of those against whom insolvency proceedings are initiated. A bench comprising Chief Justice D Y Chandrachud and justices J B Pardiwala and Manoj Misra decided as many as 391 petitions challenging various provisions of the IBC. Many pleas challenged the constitutional validity of sections 95(1), 96(1), 97(5), 99(1), 99(2), 99(4), 99(5), 99(6) and 100 of the Code. These provisions deal with the various stages of insolvency proceedings against a defaulting firm or individuals. Upholding the provisions to be constitutionally valid, the bench held that they did not suffer from arbitrariness as contended. "The IBC cannot be held to be operating in a retroactive manner in order to hold it violative of the Constitution. Thus, we hold that the statute does not suffer from

NCLAT adjourns hearing on IDBI's insolvency plea against Zee to Dec 6

The National Company Law Appellate Tribunal (NCLAT) on Wednesday adjourned its hearing to December 6 over the plea of IDBI Bank seeking to initiate insolvency proceedings against Zee Entertainment. A three-member NCLAT bench deferred the hearing after the counsel appearing in the matter sought an adjournment to complete the pleadings. IDBI Bank in its plea has challenged the order of the Mumbai bench of the National Company Law Tribunal (NCLT), which, on May 19, 2023, had set aside the insolvency plea against the media major, observing that it was barred under Section 10A of the Insolvency & Bankruptcy Code (IBC). In its order, the NCLT bench had said that ZEEL, which was the corporate guarantor for the loan availed by Siti Networks -- the principal borrower of IDBI Bank -- has committed a default. However, the default was committed during the timeline specified under section 10A of the IBC. Section 10A mandates no application for initiation of a corporate insolvency resolution ..