Lok Sabha Question No. 191 (STARRED), answered on 2024-12-09
Subject: Insolvency and Bankruptcy Framework
Ministry: CORPORATE AFFAIRS
Asked by: Shri Bharatsinhji Shankarji Dabhi, Shri Tejasvi Surya

## GOVERNMENT OF INDIA MINISTRY OF CORPORATE AFFAIRS

LOK SABHA STARRED QUESTION NO. 191

ANSWERED ON MONDAY, DECEMBER 9, 2024/ AGRAHAYANA 18, 1946 (SAKA)

## INSOLVENCY AND BANKRUPTCY FRAMEWORK

## QUESTION

*191. SHRI BHARATSINHJI SHANKARJI DABHI: SHRI TEJASVI SURYA:

Will the Minister of CORPORATE AFFAIRS be pleased to state:

(a) the steps taken to set up a robust insolvency and bankruptcy framework;

(b) the measures taken to streamline the insolvency and liquidation process for Financial Service Providers (FSPs);

(c) the outcome and milestones achieved since the enactment of the Insolvency and Bankruptcy Code in the country; and

(d) the comparative analysis of insolvency frameworks and variations in the time allowed for companies to voluntarily file for bankruptcy and closure in the country with the other countries?

## ANSWER

THE MINISTER OF FINANCE

AND CORPORATE AFFAIRS                             (SHRIMATI NIRMALA SITHARAMAN)

वित्त एिं कारपोरेट कार्य मंत्री

( श्रीमती विमयला सीतारामि )

(a) to (d): A Statement is laid on the Table of the House.

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STATEMENT REFERRED TO IN REPLY TO PART (a) TO (d) OF LOK SABHA STARRED QUESTION  NO. *191  (11 th   POSITION)  FOR  9 th   DECEMBER,  2024  REGARDING 'INSOLVENCY AND BANKRUPTCY FRAMEWORK' (a):    To  strengthen  the  process  of  Insolvency  Resolution  and  to  ensure  proper implementation of the provisions of Insolvency and Bankruptcy Code, 2016 (IBC), the  Government  has  made  six  amendments  to  the  IBC  and  Insolvency  and Bankruptcy Board of India has made more than 100 amendments in regulations since inception of IBC. (b): IBC provides a consolidated framework  for reorganization, insolvency resolution and liquidation of corporate persons, except Financial Service Providers (FSPs). However, Section 227 of the IBC enables the Central Government to notify FSPs  and  categories  of  FSPs  for  the  purpose  of  insolvency  and  liquidation proceedings.  Accordingly, vide notification dated 18th November 2019, the  Central Government, in consultation with the Reserve Bank of India (RBI), notified  that insolvency resolution and liquidation proceedings of Non-Banking Finance Companies (which include housing finance companies) with asset size of Rs.500 crore or more, as per last audited balance sheet shall be undertaken in accordance with  the  provisions  of  the  Code  read  with  the  Insolvency  and  Bankruptcy (Insolvency  and  Liquidation  Proceedings  of  Financial  Service  Providers  and

Application to Adjudicating Authority) Rules, 2019. (c):    A  total  of  1068  cases  have  been  resolved  under  the  Corporate  Insolvency Resolution Process (CIRP) under IBC leading to a recovery of about Rs. 3.55 lakh crore to the creditors since inception of IBC till September, 2024. (d):   Under IBC and the regulations made thereunder, the timeline for Corporate Insolvency  Resolution  Process  is  180  days  which  can  be  extended  by  the Adjudicating  Authority  (AA)  for  a  period  of  90  days.  The  model  timeline  for  the liquidation and voluntary liquidation process is one year and 270 days respectively. With  respect  to  comparison  of  timeline  with  other  countries,  no  such  data  is maintained.

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