NEW DELHI: Amid criticism over delayed resolution of cases under the Insolvency and Bankruptcy Code (IBC), the chairman of insolvency regulator pointed out on Friday that 270 cases defaults were resolved in 2023-24 against the average 125 in the previous years. Ravi Mital, the chairman of Insolvency and Bankruptcy Board of India (IBBI), said that the number of resolution per year would continue to grow.
Mital was speaking at an event organized by the Institute of Chartered Accountants of India (ICAI). He said that it is crucial for project completion to be timely and efficient. “Faster resolutions can address many concerns,” said Mital.
He said that India has outperformed many countries in insolvency resolution, and Indian resolution professionals should extend their expertise globally.
“IBC not only protects creditors’ interests but also promotes economic growth in the nation, which is reflected by NPAs being at the lowest levels,” he added.
The IBC has successfully settled around 28,000 cases, and around Rs 3.4 lakh crore debt has been settled. Mital, however, pointed out the need for improvement in the quality of information Memorandum. He also called for more disclosures in the Information Memorandum, which is a document released by the insolvency professional at the time of inviting Expression of Interest from interest resolution applicants.
The insolvency regulator said with little more effort from resolution professional, the recovery rate under IBC could increase from 32% to 40%. During the inaugural session Justice Ashok Bhushan, Chairperson, National Company Law Appellate Tribunal (NCLT), said that The landscape of insolvency and bankruptcy has evolved significantly, with the Insolvency and Bankruptcy Code (IBC) becoming pivotal in addressing corporate distress.
He also praised the ICAI is playing a key role in understanding the intricacies and promoting best practices in this emerging landscape.