Bill to amend IBC passed by Parliament
Bill to amend IBC passed by Parliament
Praveen Dwivedi
Bill to amend IBC passed by Parliament
Photo: CitySpidey

Bill to amend IBC passed by Parliament

New Delhi: A Bill to amend Insolvency and Bankruptcy Code (2020) was passed by the Rajya Sabha on Thursday with an aim to give a passage to bidders of insolvent companies from risk of criminal proceedings for offences committed by previous promoters. 

The IBC -2020 (Amendment) was already passed by Lok Sabha on March 6.

Replying to a short debate on the Bill, Finance Minister Nirmala Sitharaman said, "Amendments are in the sync with time and also adhere to a Supreme Court order in letter and spirit.”

The finance minister said that the need for amendment in the IBC arose because of changing requirement and requirement of fine tunning the law as several MPs wanted to know why the government was bringing in so many amendments to a new law.

Stressing that the government is very responsive and has been talking to the industry, she assured the House that amendments to the IBC are are not being unthinkingly done.

The IBC, which came into force in 2016, has already been amended thrice.

Sitharaman said the government was taking care of the interest of home buyers and the requirement of minimum number of homebuyers in the IBC has been included to avoid "frivolous litigations".

The bill seeks to remove bottlenecks and streamline the corporate insolvency resolution process. It aims to provide protection to new owners of a loan defaulter company against prosecution for misdeeds of previous owners.