Rajya Sabha today took up the Insolvency and Bankruptcy Code (Second Amendment) Bill, 2020 for consideration and passing. The Bill moved by Finance Minister Nirmala Sitharaman amends the Insolvency and Bankruptcy Code 2016 which provides a time bound process for resolving insolvency in companies and among individuals. Insolvency is a situation where individuals or companies are unable to repay their outstanding debt. The Bill seeks to temporarily suspend initiation of the corporate insolvency resolution process, CIRP under the Code. It replaces the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020 promulgated in June this year. The Bill provides for defaults arising during the six months from 25th March of this year, CIRP can never be initiated by either the company or its creditors. The central government may extend this period to one year through notification. Initiating the discussion, Vivek Tankha of Congress questioned several provisions of the Bill urging that these must be relooked for the interest of the public. He said, some of the provisions will benefit the big companies and prove to be detrimental for the small companies including MSMEs. Dinesh Trivedi of TMC said that legislation must not be brought in hurry without larger consultation. Amar Patnaik of BJD said that the quality of the resolution has to be improved. Ravi Prakash Verma of Samajwadi Party said that NPA is continuously rising in the country and the number of willful defaulters has also increased. Arun Singh of BJP termed the Insolvency and Bankruptcy Bill as a remarkable and bold step. Singh said, India’s ranking in Ease of Doing Business has improved under the present regime. A Vijayakumar of AIADMK, P. Wilson of DMK, RCP Singh of JD(U) also spoke on the Bill. The discussion on the bill is underway.
