Government Appoints 14 member Committee to Review IBC law

Hyderabad Nov 22: In a move to remove glitches in the law and smooth implementation the government has appointed a 14 member committee to review the working of Insolvency and Bankruptcy Code which was formed last year.Currently, the code helps to resolve insolvencies of the companies.

The 14-member committee is headed by corporate affairs secretary I Srinivas, includes Insolvency & Bankruptcy Board of India (IBBI) chairman MS Sahoo, representatives from RBI, department of financial services and external experts.

The other members of the committee include RBI Executive Director Sudarshan Sen former Lok Sabha Speaker T K Viswanathan, Edelweiss Group Chairman, and CEO Rashesh Shah, Shardul Amarchand Mangaldas & Co-Executive Chairman Shardul, Shroff Xpro India Chairman Sidharth Birla, AZB & Partners Partner Bahram Vakil, SBI Stressed Assets Resolution Group MD B Sriram, Additional Secretary (Banking) at the Department of Financial Services and a Joint Secretary from the corporate affairs ministry.

Presidents of the institutes of chartered accountants, cost accountants, and company secretaries are also part of the committee. The panel can also invite practitioners, experts or individuals having knowledge about insolvency, law or economics and representatives from other regulators or ministries,


The main function of the committee is to assess the functioning of the new law and examine issues that could impact the framework prescribed under the law. and submit the report within 2 months from its first meeting.

Currently, the government has asked the committee to address the three issues so that the law can be made more effective and loopholes are plugged.

# Home buyers: Currently these are not fitting into the financial creditor's group, nor are they part of operational creditors and left them no choice to file Insolvency petition.

# Allowing promoters: IBBI is in a dilemma whether to allow a promoter to bid for the property which is to be resolved.In some cases, promoters were blocked to bid whereas they were allowed

# Finding investors :currently there are no investors for second-or three-tier companies.

# Miscellaneous: To make sure that the failed management is permanently ousted and the new one takes place so that the company doesn't undergo bankrupt once again.