(MENAFN- KNN India) Govt. hints at increasing number of bankruptcy courts to address bankruptcy cases
New Delhi, Mar 23 (KNN) With a view to reduce the burden of existing benches handling bankruptcy cases, government is considering to increase the number of bankruptcy courts.
The government is also considering to hire more judicial and technical officers and in this regard, hiring is expected to start in about 2 months to take into account the requirement of the new NCLT benches at Cuttak, Jaipur and Kochi.
Corporate Affairs Secretary Injeti Srinivas in a press said that idea is to resolve the bankruptcy cases in less than one year as compared to earlier system that used to take over 4 years to solve the case.
Also, to ease the load on existing benches overburdened by creditors suing defaulting businesses and expedite resolution of insolvency cases, he added.
Experts said bankruptcy courts are over-burdened as they also address other company law matters relating to mismanagement and oppression, mergers and acquisitions and cases of de-registration of companies on account of defaulting on statutory annual return filing requirements.
'Stepping up the capacity of bankruptcy courts is very much required as insolvency and M & A cases are time sensitive, said Manoj Kumar, a partner at law firm Corporate Professionals.
Expected changes to the insolvency and bankruptcy code include introduction of a simpler code for micro, small and medium enterprises, granting creditor status to home buyers who have given advances to real estate firms and modifying procedures about clearing turnaround plans and etc.
An expert panel is expected to give its recommendations on modifications to the bankruptcy code to the government shortly.
Srinivas said 'the long-term impact of the insolvency and bankruptcy code's functioning has been salutary.
He said that one benefit that has already accrued from the code is that banks are much more thorough in their appraisal of loan applications while businesses are cautious about unsustainable levels of debt. (KNN/YV)
MENAFN2403201801550000ID1096645931
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.