Government

October 05, 2018

NCLAT CHAIRPERSON SAYS IBBI NEEDS TO HAVE MORE POWERS


Law

NCLAT Chairperson Justice Sudhansu Jyoti Mukhopadhyaya has said that the Insolvency and Bankruptcy Board needs to be given more powers.

Mr Mukhopadhyaya also suggested that the Committee of Creditors (CoC) should have regulations.

Particularly on the backdrop of efforts to deal with non-performing assets in the banking system, the number of cases coming up for resolution under the Insolvency and Bankruptcy Code (IBC) is on the rise. The IBBI implements the Code.

Delivering the first annual day lecture to commemorate the establishment of the IBBI, Mr Mukhopadhyaya said, "More power (is) required to be given... to the IBBI. There has to be a regulatory body for the COC on how they function, otherwise it would be very difficult for process to follow because for every matter, a court cannot lay out the law.”

Creditors are represented by the COC under the Code and the COC needs to approve the resolution plan before it is finally cleared by the tribunal.

One thousand and one hundred corporates are undergoing the insolvency resolution process, of which, about 250 have completed the process by resolution or liquidation, according to Mr Mukhopadhyaya. He added that around 250 corporates had commenced voluntary liquidation. Only after the National Company Law Tribunal (NCLT) gives its nod is a matter taken up for resolution under the Code.

NCLT decisions can be challenged before the National Company Law Appellate Tribunal (NCLAT).

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