NEW DELHI: The government is looking at a proposal to give higher priority to the claims of small operational creditors in cases of liquidation under the bankruptcy code, an official said.
This comes after representations that small and medium enterprises (SMEs), which are suppliers of goods or services to a defaulting company, face huge losses during bankruptcy proceedings, pushing them towards bankruptcy in some cases and also leading to job losses for those employed with them.
“In a few cases which are presently under liquidation, it has been pointed out that SMEs face the brunt, putting them under severe stress,” said the government official cited earlier. “We are examining the issue,” the person said.
Under the re…
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