New Delhi: The Lok Sabha today cleared the Insolvency and Bankruptcy Bill 2015, paving way for faster and easier resolutions to business disputes in India.
Once implemented, the law will make insolvency resolutions speedier thus facilitating fastrer exits and easier turnarounds for companies. The move will make a significant impact on imrpoving the ease of doing business in India.
As per the law, the cases of insolvency will be resolved within a period 180 days, which can be extended by another 90 days. This code will replace the existing obsolete bankruptcy laws and provide a time-bound process for resolving insolvency issues.
The proposed law provides for fast-track resolution of corporate insolvency within 90 days. It will cover individuals, companies, limited liability partnerships and partnership firms. It will also amend laws including the Companies Act to become the overarching legislation to deal with corporate insolvency and will help in faster debt recovery for creditors.
Singificantly, the law will protect workmen and employees in case the employer files for bankruptcy.
The bill will now go to the Rajya Sabha for its consent.
(With agencies)
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