When India’s first resolution plan under the Insolvency and Bankruptcy Code (IBC) was approved in August 2017, it shook confidence in the country’s new insolvency architecture. A related party regained control of the company while creditors absorbed a staggering 94% haircut. What was meant to be a market-driven rescue mechanism appeared to have become a loophole for errant promoters to cleanse balance sheets and reclaim assets. The legislative response — Section 29A — was swift and uncompromising. Nearly a decade later, however, the context has changed, raising a difficult but necessary question: does Section 29A still serve the IBC’s core objective of value-maximising resolution, or has it become an obstacle to it?
Insolvency Guardian
Insolvency Services & Bankruptcy Advice
