6 days ago
- Business
- New Indian Express
Out-of-court, debtor-in-control process to hasten resolution of insolvency cases
NEW DELHI: A lender-initiated, debtor-in-control resolution process, as proposed under the Insolvency Bill, is a big step towards faster resolution of insolvency cases in India, feel experts.
The Insolvency & Bankruptcy Code (Amendment) Bill, 2025, which was tabled in parliament on Tuesday, has proposed the 'creditor-initiated insolvency resolution process', under which a resolution process can be initiated on approval of 51% of the financial creditors. However, the management of the company continues to be vested with the existing board of directors of the company under the supervision of the resolution professional appointed by financial creditors.
The delay in getting approval of the adjudicating authority (NCLT) is the biggest reason for delay of the whole resolution process. In order to address this issue, the Bill proposes that a creditor-initiated resolution process can be initiated without the need for NCLT approval.
'The process contains provisions for approaching the adjudicating authority at different stages but not for the initiation of the process unless objected by the corporate debtor,' says Surendra Raj, partner, Grant Thornton.
