Introduction
As part of the Government's ongoing efforts to combat the
economic fallout of the COVID-19 crisis, the Union Finance Minister
in a press conference dated 24 March 2020 announced an increase in
the threshold for invoking the corporate insolvency resolution
process (CIRP) under the Insolvency and Bankruptcy Code, 2016
(IBC). A notification published by the Ministry of Corporate
Affairs on the same date (Notification) states that the
"Central Government hereby specifies one crore rupees as the
minimum amount of default for the purposes of the said
section."
The Kolkata Bench of the Hon'ble National Company Law
Tribunal (NCLT Kolkata / Tribunal) has, in its Order dated 20 May
2020 in Foseco India Limited v Om Boseco Rail Products Limited (CP
(IB) No 1735/KB/2019), ruled on whether this increase in threshold
is prospective or retrospective in effect.
