There are concerns that lenders have had to take largehaircutson firms that go through the Corporate Insolvency Resolution ProcessorCIRPunderthe Insolvency and Bankruptcy Codeor IBC. The unease over low recoveries resulted in the National Company Law Appellate Tribunal, orNCLAT,orderingrestartingof aconcludedresolution processof Videocon Industries in January this year.
Revisitingcommercial decisions taken by the Committee of Creditors (CoC) increases uncertainty in the IBC process. While anxiety about low recoveries from the IBC may be valid, we should revisit how large the haircuts are and investigate the factors that drive this outcome. Improvements in recoveries are more likely to result from systematicfixtures tooverall policy envi…
Read the full article at: https://theprint.in/opinion/low-ibc-recoveries-are-a-worry-but-solutions-lie-in-cutting-court-delays-not-blaming-coc/1251201/