Creating Inroads In The Liquidation Process Under The New IBC Insolvency & Bankruptcy Code 2016

THE BACKGROUND

The recently introduced legal, regulatory and policy changes that have been introduced in the Indian BFSI sector have not only geared up the pace at which the sector is operating but has also created a change in the overall dynamics. On 31st December 2016, gross Non Performing Assets (NPA) in the Indian Banking Sector stood at approximately 9.3 % of total advances1. This has adversely affected the economy at large leading to blockage in huge amounts of capital, which could be deployed for other productive purposes, thereby derailing the spirit of entrepreneurship in the country. In order to combat with this situation, the RBI has been taking several steps and initiatives in the past few years such asJoint Lender Forum, Strategic Debt Restructuring and Scheme for Sustainable Structuring of Stressed Assets (S4A) to name a few that have aimed to tackle the quantum of bad loans. With the introduction of these initiatives, the Insolvency and Bankruptcy Code