The Ministry of Corporate Affairs (MCA) vide its notice dated 23.12.2021 (notice) invited comments from the public on proposed changes to the Corporate Insolvency Resolution and Liquidation Framework under Insolvency and Bankruptcy Code, 2016.
The gist of the proposed changes is as follows:-
Sr. No.
Gist of the Change
Concerned Section
Connected with
Para of the Notice
1.
Submission of only IU authenticated records by the FCs financial creditors as prescribed by the CG
Section 7
CIRP & Liquidation
Para 1.4 of the notice
2.
Cooperation by parties for collection of data by IPR/RP w.r.t. to filing of applications connected with PUEF transactions
Section 19, 43-51, 66 & 67
CIRP & Liquidation
Para 2.1(a)(i) of the notice
3.
RP/LQ will be responsible for investigating the affairs of the CD for identification of PUEF transactions
Section 25, 35, 43-51, 66 & 67
CIRP & Liquidation
Para 2.1(a)(ii) of the notice
4.
The creditors (individually or in groups) can apply to the AA for PUEF transactions, if the RP/LQ fails to do so
Section 43-51, 66 & 67
CIRP & Liquidation
Para 2.1(a)(iii) of the notice
5.
Continuation of PUEF transactions proceedings after approval of resolution plan
Section 31, 43-51, 66 & 67
CIRP
Para 2.1(b) of the notice
6.
Threshold for the look-back period for PUEF transactions will now start from date of filing of the application for initiation of CIRP
Section 43-51, 66 & 67
CIRP & Liquidation
Para 2.1(d) of the notice
7.
Resolution Plan should mandatorily specify the manner of undertaking PUEF transactions proceedings and distribution of expected recoveries from it
Section 26
CIRP
Para 2.1(c) of the notice
8.
AA to approve/reject a resolution plan within 30 days
Section 31
CIRP
Para 3.1(d) of the notice
9.
Closure of the Voluntary Liquidation Process by way of a SR or members’ resolution and approval of creditors representing 2/3rd in value of the debt
Section 59
Voluntary Liquidation
Para 4 of the notice
10.
Central Government to prescribe a detailed framework for contribution to and utilisation of the IBC Fund.