Lok Sabha Debates Combined Discussion On Statutory Resolution Regarding Disapproval Of ... on 21 September, 2020 Seventeenth Loksabha an> Title: Combined discussion on Statutory resolution regarding Disapproval of Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020 (Ordinance no. 9 of 2020) and Insolvency and Bankruptcy Code (Second Amendment) Bill, 2020 (as passed by Rajya Sabha) (Statutory Resolution Withdrawn and Government Bill passed). माननीय अध्यक्ष : आइटमनंबर – 18 और 19 को एक साथलिया जाएगा *m01 SHRI ADHIR RANJAN CHOWDHURY (BAHARAMPUR): Sir, I beg to move: "That this House disapproves of the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020 (Ordinance No. 9 of 2020) promulgated by the President on 5 June, 2020." माननीय अध्यक्ष : माननीय मंत्री जी, क्या आप बिल पर कुछ बोलना चाहती हैं? …(व्यवधान) माननीय अध्यक्ष : माननीय मंत्री जी, अब आप बिल को मूव कीजिए । …(व्यवधान) *m02 THE MINISTER OF FINANCE AND MINISTER OF CORPORATE AFFAIRS (SHRIMATI NIRMALA SITHARAMAN): Sir, I beg to move: “That the Bill further to amend the Insolvency and Bankruptcy Code, 2016, as passed by Rajya Sabha, be taken into consideration.” माननीय अध्यक्ष : प्रस्तावप्रस्तुत हुए : “कि यह सभा राष्ट्रपति द्वारा 5 जून, 2020 को प्रख्यापित दिवाला और शोधन अक्षमता संहिता (संशोधन) अध्यादेश, 2020 (2020 का अध्यादेश संख्यांक 9) का निरनुमोदन करती है ।” और “कि दिवाला और शोधन अक्षमता संहिता, 2016 का और संशोधन करने वाले विधेयक,राज्य सभा द्वारा यथापारित, पर विचार किया जाए ।” माननीय अध्यक्ष : श्रीअधीर रंजन चौधरीजी । …(व्यवधान) *m03 SHRI ADHIR RANJAN CHOWDHURY: Sir, first of all, I took a serious exception to the way one after another Ordinances are being promulgated on the pretext of COVID19 pandemic. Yes, our Constitution has the provision for promulgation of Ordinances. But I would suggest the Government that the promulgation of Ordinances should not be taken as a rule; rather, it should be considered as an exception. But what I am afraid of is that this Ordinancesavvy Government is, on one pretext or the other, resorting to promulgation of Ordinances. That is why, I have put my disapproval. The purpose of the Ordinance on IBC is that it is weakly constructed with minimum logic and a lot of grey areas, and discouraging to the healthy recovery and restructuring practices and at the same time, leaving loopholes for debtors. It is nothing but to patronize their preferred corporators. The worst casualty of this Ordinance is the MSME sector. Section 10A can be absolutely a nightmare for the corporate creditors. When such a loose exit is created for the escape of debtors, the burden will shift to the creditors and they would not be having anyone liable. MSMEs are very strong contributors to the GDP as well as employment. There are around 120 million people working in MSME sector. These MSMEs usually lend their services to large corporate. The IBC framework is the resort of MSMEs in case of insolvency or bankruptcy. Until last year, MSMEs were hugely benefited by the IBC framework. The data on recovery of debt through IBC framework is Rs. 1.52 lakh crore. At this moment, the suspension of IBC can be a huge blow to the MSMEs of our country, especially in cases with exemption of defaulters from liabilities under section 10A. If a system with protection and safeguards for MSMEs is dissolved in favour of specific corporate debtor, the Government is answerable to 120 million people working in this sector. 18.00 hrs It is because on the one hand the Government is serving halfbaked cookie called Atmanirbar Bharat and forcing them to take more loans, and on the other hand they are removing their safety net against exploitation. Can Government ask themselves what have they done to create more through MSMEs? What is the Government’s achievement in last six months? This is high time that the Government should do an introspection. I would simply narrate four concepts which need to be stressed. First one is the maximisation of value of assets. Quoting Mr. Shardul Shroff, who is the Executive Chairman of Insolvency and Bankruptcy Practices, maximization of value of assets can be either revival or liquidation of the corporate debtor, to put its assets to best possible economic use. It is important to have both the options available for preserving the best value of assets. Instead, what we witness is the suspension of IBC framework for a significant period of time. By suspendin