The Insolvency and Bankruptcy Code, 2016
(“Code”), has attracted attention
since its inception and it is being closely watched since the day
it has come into effect, as it brings along with itself a promise
to change the face of corporate insolvency process in India. The
Code is a result of years of grappling with the Insolvency laws of
India and an attempt to overhaul them. In this Article we seek to
highlight the journey towards the Code and the preceding laws that
eventually had to make way for the Code.
History of Insolvency Laws in India
In India, the necessity of insolvency laws was first felt in the
Presidency towns of Bombay, Calcutta and Madras as they were the
towns where trade was primarily conducted during the time of the
British reign in India. Section 23 and Section 24 of the Government
of India Act, 1800 which conferred jurisdiction to decide on
matters pertaining to insolvency on the Supreme Court of Fort
William and Madras and the Recorders Court
