Bankruptcy Law Reforms Committee (“BLRC”) was very clear while setting out the objectives of the new insolvency law for the country and speedy resolution/decision making in an insolvency situation was stated to be one of such foremost objectives. Fragmented laws governing an insolvency and lack of a cohesive framework governing the rights of various stakeholders during insolvency was identified as a primary reason for inefficiency of the pre-existing legal framework.

The rights of secured creditors under the Insolvency and Bankruptcy Code, 2016 (Code) have been a matter of continuous litigation and uncertainty. Early on, the challenge presented itself when during the insolvency resolution of Essar steel (India) Ltd., the National Company Law Appellate Tribunal (NCLAT) directed the distribution of resolution plan proceeds equally amongst all classes of creditors, including financial, operational, secured and unsecured creditors.

In a recent case, the Victorian Supreme Court said that an accountant ‘would know well that a statutory demand involves strict time frames for response and potentially very significant consequences for a company’. The accountant failed to take appropriate steps to inform the company of the statutory demand.

The statutory demand process

If a company does not comply with a statutory demand within 21 days of service, it is deemed to be insolvent and the creditor may proceed to wind up the company.

A recent court decision considers the legal principles and sufficiency of evidence when a court-appointed receiver seeks approval of their remuneration.

A court-appointed receiver needs court approval for the payment of their remuneration. The receiver has the onus of establishing the reasonableness of the work performed and of the remuneration sought.

Introduction
Delays at plan approval stage
Measures to reduce delays

Introduction

Introduction
Decision
Comment

Introduction

Introduction
Key legal issues
Comment

Introduction

Introduction
Practical implications
Comment

Introduction

What is likely to be proposed?
What is the likely impact of these proposals?

Following the finance minister's speech proposing the Union Budget 2022, Parliament is likely to consider further amendments to the Insolvency and Bankruptcy Code 2016 (IBC) in 2022.

Decision
Comment

Following several civil appeals, the Supreme Court has decided in its final order and judgment dated 13 September 2021 (the judgment) whether a resolution plan that has already been approved by the requisite majority of the committee of creditors (CoC) and that is pending the approval of the adjudicating authority can be modified or withdrawn by a resolution applicant under the Insolvency and Bankruptcy Code 2016 (the Code).