Since the Insolvency and Bankruptcy law has come into force, there has been a shift towards the positive where creditors facing the perennial problem of bad loans have been given a sustainable solution.
In a recent news, it has come out that 45 bankrupt companies have now been approved for revival under the new insolvency law and has managed to recover more than Rs. 50,000 crore or 50 percent of the total claims of creditors.
According to the Insolvency and Bankruptcy Board of India Chairperson, MS Sahoo, the recovery from the said 45 companies makes up for about 50% percent of the total claims which is actually a very positive step forward. Since the law came into effect, close to 1,100 companies have been admitted in the Corporate Insolvency Resolution Process under the law. Under this, 180 companies have been sent for liquidation and presently there are 800 corporates undergoing CIRP and 100 cases have been closed on appeal or review as their admission was controversial.
During the conversation, Mr. Sahoo said that the recovery in 34 companies which were approved for resolution till end of June was approximately 56% which was far higher than the liquidation value of the combined stressed assets.
The swift manner in which National Company Law Tribunal is addressing the increase pile of cases is commendable and goes to show the impact the law has had on the corporate sector in India.