Bankruptcy Law Reform Committee under former law secretary T.K.
Bankruptcy Law Reform Committee under former law secretary T.K. Viswa-nathan on Wednesday recommended a modern bankruptcy law to deal with insolvency cases within 180 days that may arise on account of business failures or economic downturns, to promote ease of doing business and spur economic activities.
The draft Bill prescribes a swift process and timeline of 180 days for dealing with applications for insolvency resolution. This can be extended for 90 days by the adjudicating authority only in exceptional cases. During insolvency resolution period, the management of the debtor is placed in the hands of an interim resolution professional, it said.
Finance minister Arun Jaitley said that the government would try to introduce a Bill on bankruptcy law in the forthcoming Winter Session of Parliament.
“My endeavor would be try and introduce it in the next session of Parlia-ment,” he said.The committee has observed that the enactment of the proposed Bill will provide greater clarity in the law and facilitate the application of consistent and coherent provisions to different stakeholders affected by business failure or inability to pay debt and will address the challenges being faced at present for swift and effective bankruptcy resolution.
