Valiant features of Insolvency Code 2016

Objective

Promote entrepreneurship availability of credit and  balance of interest, of all stakeholders by consolidating and amending the laws relating to organisation and insolvency resolution of corporate persons, partnership firms and individuals in time bound manner and for maximisation of the value of assets of such persons.

To consolidate laws relating to insolvency of companies and LLP entities, partnership, individuals presently contained in no. of legislations into a single legislation.

Saliant features of Code

1. Clear, coherent and speedy process for early identification of financial distress, and resolution of companies and limited liability entities if underlying business is found to be viable.

2. Resolution of individuals- fresh start and insolvency resolution

3. DRT (Debt Recovery Tribunal) and NCLT (National Company Law Tribunal notified on 1st June 2016) to act,adjudicating authority and deal cases for insolvency liquidation and bankruptcy in respect of individuals and unlimited partnership firms and of companies and limited liabilities.

4. Establishment of an insolvency and bankruptcy Board of India to exercise regulatory oversight over insolvency professionals, Insolvency Professional Agencies and information utilities.

5. Insolvency Profesional would handle commercial aspects of an insolvency resolution process, IPA will develop professional standards, code of ethics and first level regulator for insolvency Professional members leading to the development of a competitive industry for such professionals.

6. Information utilities would collect authenticate and disseminate financial information to be used in insolvency, liquidation and bankruptcy proceedings.

7. Enabling provisions to deal with cross-border insolvency.

Essential Idea

Within 180 days in case of default on company's debt, control shift from share holders/ promotors to a committee of creditors to evaluate about resuscitating company or taking into liquidation . decision time bound.

Productive resources of the economy (Labour & Capital) can be departure with experience under SICA.

Entrepreneurs and lenders will be dealt to move instead of being bogged down.

Four Pillars of Institutional Infrastructure

1. IP class of regulated persons

2. IP would be regulated by IPA

3. IU store facts bout lenders and terms of lending in electronic database would eliminate delays and disputes when default tale place.

4. NCLT - Insolvency firms be heard with appellate Authority.

5. DRT- Individuals insolvency with appellate Authority

6. Insolvency & Bankruptcy Borad of India -Regulatory oversight over IP,IPA,IU

The above code lays foundation of development of corporate Bond Market.

This code is given more benefits to investors and they can file class litigation to protect their benefits.

We are handling JV, Restructuring and interest of investors before the NCLT, NPA having team of experienced experts Viz; CA, CS, Direct and indirect tax, corporate lawyers having experience more than 25 years having twm of experts more than 30.

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