Supreme Court upholds Insolvency and Bankruptcy Code in its entirety

Supreme Court upholding the IBC will speed up recovery of NPAs

The Supreme Court has dismissed a bunch of petitions and upheld the Insolvency and Bankruptcy Code in its “entirety”. Today a bench of Justices Rohinton Nariman and Navin Sinha ruled that the code is constitutionally valid.

The petitions had challenged the IBC on the ground that it discriminates against Operational Creditors and their interests with respect to Financial Creditors. The petitioners had argued that their fundamental rights as promoters were being violated as the law barred them from bidding for their own companies.

The two-judge bench of the Court headed by Justice Nariman concluded that the provision of the law that prevented founders from bidding for their own defaulting companies was legally valid.

- Advertisement - - Article resumes -

The petition to permit promoters to bid for their own companies was initially filed by the promoters of Bhushan Power & Steel. Later, the Court had merged similar petitions filed by operational creditors of Binani Cement.

The specific provision of the IBC bars willful defaulters, their parent company and even related persons from buying back the assets at rock bottom prices. The consequences of and motivations behind the provision have been duly explained here.

The IBC has motivated numerous companies to hurry up and clear their dues. In May last year, it was reported that fearing government crackdown, 2100 companies had rushed to clear their dues to the tune of Rs. 83000 crores.

In November last year, it was reported that the IBC led to the recovery of Rs. 3 lakh crore since it became fully operational two years earlier.

The Insolvency and Bankruptcy Code (IBC) 2016, is a bankruptcy law in India brought by the Narendra Modi led NDA government seeking to consolidate the existing framework by creating a single Law for Insolvency and Bankruptcy. The Code provides a time-bound process for resolving insolvency in companies and among individuals resulting in much-needed impetus to solving the problem of stressed assets and NPAs in the financial sector of the country.

Share This Post and Support:
We need your support to survive in the media industry. Please consider paying us for the content we produce:

To know more about these payments, please click here.

Most read articles recently

Dear Gujarat Samachar editor, how do you live with yourself?

Gujarati daily's insensitive headline over Pulwama attack has got readers upset

Pakistan funded Islamic terrorist blows up 300 kgs of IED, actor brings ‘Hindu right wing’ argument to shield Pakistan

Jaaved Jaaferi refuses to hold Pakistan accountable for the attack, instead equates Hindus with Jaish Terrorists.

Delhi’s education minister deletes tweet after being educated about electricity supply to Pakistan by Adani

Sisodia, without apologising or issuing a clarification, chose to quietly delete the tweet after being called out

NDTV suspends Deputy News Editor for celebrating Pulwama terror attack, may take further action

NDTV Deputy News Editor Nidhi Sethi suspended by the channel for her Facebook comment celebrating the Pulwama attack
Congress mouthpiece National Herald whitewashes Pulwama terrorist Adil Ahmed Dar

More stories about terrorist and his family than martyrs – what does it tell about the media?

The English language Indian media has focused more on ‘human stories’ about the terrorist than about the Pulwama martyrs.

JNU ‘student’ who was accused of stealing funds in Kathua case found spreading rumours about Kashmiri girls trapped in Uttarakhand

CRPF also issued a notice that certain 'miscreants' on social media are spreading rumours and hate on social media

Pulwama attack: Foreseeing strong and fast reaction from India, Pakistan relocates its terrorists nearer to Pak army camps

As per the report, Pakistan has not even vacated the winter posts along the LoC which it usually does.

Pulwama attack: Justice doesn’t give a tiny rat’s furry posterior about the sensibility of elites who go where the money takes them

Pulwama attack victims' mortal remains weren't even cold yet. The candles lit by the nation has not even been blown out by a sorrowful sigh of the nation, that the vultures started circling the remains
Rahul Gandhi

BJP government got soldiers killed for electoral gains: Gujarat Congress leader’s controversial remark

Congress leaders and supporters have been trying to float the theory that the Pulwama attack was an inside job

Latest articles

Connect with us


Don't miss these