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This Article is From Jul 04, 2019

Claims Worth Over Rs 1.73 Lakh Crore Settled Under Insolvency Law: Economic Survey

A total of 6,079 cases involving a total amount of Rs 2.84 lakh crore were withdrawn before admission under provisions of the Insolvency and Bankruptcy Code (IBC) till February 28

Claims Worth Over Rs 1.73 Lakh Crore Settled Under Insolvency Law: Economic Survey
The corporate insolvency resolution process yielded a resolution of 94 cases till March 31
New Delhi:

The corporate insolvency resolution process yielded a resolution of 94 cases till March 31 which has resulted in the settlement of claims worth Rs 173,359 crore, according to the Economic Survey 2018-19 tabled by Finance Minister Nirmala Sitharaman in Parliament on Thursday.

A total of 6,079 cases involving a total amount of Rs 2.84 lakh crore were withdrawn before admission under provisions of the Insolvency and Bankruptcy Code (IBC) till February 28. Besides, Rs 50,000 crore was received by banks from previously non-performing accounts.

"The accelerated recoveries show behavioural change for the wider lending ecosystem even before entering the IBC process," said the survey while calling for further strengthening of the National Company Law Tribunals (NCLTs) and the appellate tribunals."

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The survey said the ecosystem for insolvency and bankruptcy is getting systematically built out with recovery and resolution of a significant amount of distressed assets.

Terming the IBC as one of the most important economic reforms of recent times designed to effectively deal with non-performing corporate debtors, it said the NCLT infrastructure requires to be scaled up to achieve timely resolution of debt recovery.

At present, there are 32 judicial members and 17 technical members of the NCLT in 20 benches located in major cities. "The government is actively considering measures to address delays and has created six additional posts of the judicial and technical members for NCLAT. Setting up circuit benches of NCLAT is under consideration."

An IMF-World Bank study in January 2018 said that India is moving towards a new state-of-the-art bankruptcy regime.

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