Section 29A of the Insolvency and Bankruptcy Code, introduced in 2017, bars defaulting promoters, wilful defaulters and other tainted persons from bidding for stressed companies to prevent misuse of the insolvency process. Shubhangi Shukla, a legal professional, charts the course of evolution of Section 29A through various court and tribunal rulings.
Section 29Adisqualifies certain persons — especially promoters connected with the defaulting company — from participating in resolution plans, intending to prevent moral hazard and protect creditor value.
A statutory provision introduced in 2017 curbing ineligibility of certain persons (notably promoters or related parties with tainted financial records) from…