Government Reports IBC Accelerated Recovery of ₹10.22 Lakh Crore from Defaulting Companies
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New Delhi, Dec 29 (NationPress) A staggering 28,818 applications for the initiation of the Corporate Insolvency Resolution Process (CIRP), amounting to an underlying default of ₹10.22 lakh crore, were resolved prior to their admission by March 2024, thanks to the significant shift in the debtor-creditor relationship triggered by the Insolvency and Bankruptcy Code (IBC), according to the year-end review released by the Ministry of Corporate Affairs.
As of September 2024, 1,068 CIRPs have successfully resulted in resolution plans, achieving an average of 86.13 percent of the fair value of the Corporate Debtor (CD). Creditors have successfully recovered ₹3.55 lakh crore under these resolution plans.
By June 2024, the IBC has effectively guided 3,409 Corporate Debtors through the insolvency process, with 1,068 reaching resolutions via plans and the rest through appeals, reviews, settlements, or withdrawals. The resolutions of these Corporate Debtors have achieved a recovery rate exceeding 161 percent against the liquidation value. The average expenses incurred during these resolution processes are remarkably low, at just 1.37 percent of the liquidation value and 0.83 percent of the resolution value, as highlighted in the review.
The IBC has ushered in a new era of transparency and fairness in insolvency resolutions, ensuring that all stakeholders are treated equitably, with a clear and predictable resolution process, the review further emphasizes.
The Government is also contemplating the establishment of an Integrated Technology Platform under the Insolvency and Bankruptcy Code, 2016. This initiative aims to enhance transparency, minimize delays, facilitate effective decision-making, and improve oversight of the processes by authorities.
Meanwhile, the Competition Commission of India (CCI) has dealt with 1,289 antitrust matters since its establishment, successfully resolving approximately 90 percent of cases by September this year, as indicated in the review.
Additionally, from January 2024 to September 2024, the Commission received and resolved 30 new cases (including cases carried over from the previous year).
The Commission has also reviewed and approved mergers and acquisitions across various sectors, including financial markets, power generation, pharmaceuticals, and digital markets.
The CCI has initiated a study focusing on Competition Issues in the Renewable Energy Sector among BRICS Nations. The report for this study is currently being prepared, based on insights gathered from the competition authorities of the BRICS nations.
Over the past two years, the Ministry has made significant strides in compliance with Section 148 of the Companies Act, 2013.
This progress is reflected in the notable increase in filings of e-Form CRA-2 (Intimation of Appointment of Cost Auditor) and e-Form CRA-4 (Filing of Cost Audit Report). Specifically, there has been a 35 percent increase in e-Form CRA-2 filings and a 36 percent rise in e-Form CRA-4 filings for the fiscal year 2023-24 compared to 2021-22, as mentioned in the review.
