Suspension of fresh initiation of insolvency proceedings up to one year

Save(0)

Suspension of fresh initiation of insolvency proceedings up to one year

[Dated 17.05.2020]

In relation to Insolvency & Bankruptcy Code(IBC) related matters, Smt. Nirmala Sitharaman said that debts related to COVID-19 shall be excluded from defaults under IBC.

“Further enhancement of ease of doing business through IBC related measures,” says Finance Minister Nirmala Sitharaman.

– The minimum threshold to initiate insolvency proceedings raised to Rs 1 crore

– Special insolvency framework for MSMEs will be notified under Section240A of the code

– Suspension of fresh initiation of insolvency proceedings up to one year depending upon the pandemic situation

– Empowering Central govt to exclude Covid-19 related debt from the definition of default under the code

Source: News18

Read section: 240A here.

2 comments

  1. What about the case where the default takes place prior to this pandemic? Can a section 7 application be filed for the default in payment by the corporate debtor which exceeds 1 crore and the date of default is January’2020 ?

Leave a Reply

Your email address will not be published.

/* Copy to Clipboard */