India To Set Up Integrated Technology Platform To Improve IBC Ecosystem

(The Corner Office Journal) -- India plans to set up an integrated technology platform to improve the insolvency resolution-rerated ecosystem in the country.

“An integrated technology platform will be set up for improving the outcomes under the Insolvency and Bankruptcy Code (IBC) for achieving consistency, transparency, timely processing and better oversight for all stakeholders,” Finance Minister Nirmala Sitharaman said in her Budget Speech for FY24-25.

India enacted the IBC in 2016, its first comprehensive bankruptcy law in 2016, to improve the overall corporate insolvency resolution process.

The IBC has resolved more than 1,000 companies, resulting in direct recovery of more than 3.3 lakh crore rupees ($39.44 billion) to creditors, Sitharaman said. In addition, 28,000 cases involving over 10 lakh crore rupees have been disposed of even prior to admission of cases, she noted.

The finance minister said that appropriate changes to the IBC, reforms and strengthening of the tribunal and appellate tribunals will be initiated to speed up insolvency resolution.

“Additional tribunals will be established,” Sitharaman said. “Out of those, some will be notified to decide cases exclusively under the Companies Act.”

The government incorporated the National Company Law Tribunal (NCLT), a quasi-judicial authority, for dealing with corporate disputes under the Companies Act.

The NCLT is the adjudicating authority for insolvency resolution process of companies and limited liability partnerships under the IBC. Currently, there are 16 NCLT benches across India, including the principal bench in New Delhi.

Sitharaman said the government will also take steps for reforming and strengthening debt recovery tribunals and will also set more tribunals to speed up recovery.

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