Barred promoters may soon have legitimate means to regain control of their insolvent assets at the liquidation stage if recent proposals of the Bankruptcy Law Reform Committee are accepted. And while on the face of it this seems contrary to section 29A of the Insolvency and Bankruptcy Code, 2016, experts believe otherwise, pointing out that if no-one else is interested in the asset, it makes little sense to bar promoters as well.
As of March 2019, 378 corporate debtors are facing liquidation, as per IBBI data. To address the various challenges stakeholders are facing during liquidation, the BLRC has proposed the following:
- Allow promoters to participate at the liquidation stage by proposing scheme of compromise under company law.
- Give credi…
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