The resolution for corporate debtors is done under the Insolvency and Bankruptcy Code which provides for resolution through a market-driven process
As many as 1,999 cases of corporate insolvency resolution process were going on under the insolvency law as of June this year, according to the government. The resolution for corporate debtors is done under the Insolvency and Bankruptcy Code which provides for resolution through a market-driven process. In a written reply to the Lok Sabha on Monday, Minister of State for Corporate Affairs Rao Inderjit Singh said the time taken for Corporate Insolvency Resolution Process (CIRP) depends on several factors, including the nature of business, business cycles, market sentiments and marketing effort.
“As on 30th June 2022, total 1,999 CIRPs are ongoing out of which only 436 are in real estate sector. During COVID-19 pandemic period, there has been a general slowdown in the distressed asset market,” the minister said. He was responding to queries related to resolutions in the real estate sector. In last financial year, 210 applications pertaining to real estate sector were admitted for CIRP under the Code. Out of them, 18 cases have been resolved, 60 have been settled or withdrawn and in 63 cases, liquidation has been ordered. The process is going on in the rest of the cases, Singh said.
Responding to another query, the minister said the realisation by creditors through CIRP under the Code is dependent on quality assets at the time of its resolution. In a separate written reply, Singh said the Insolvency and Bankruptcy Board of India (IBBI) receives complaints and grievances from Centralised Public Grievance Redress and Monitoring System (CPGRAM), the Prime Minister’s Office, the corporate affairs ministry and other authorities.
“Till 31st July, 2022, the IBBI had received 6,231 such complaints and grievances, of which 6,172 have been disposed after examination. “Further, as per information available, Directorate of Enforcement has received one complaint against an RP (resolution professional) of one CIRP in which appropriate action under applicable law has been taken,” he said. Further, CBI has received one complaint regarding abuse of process in one CIRP matter which was forwarded to the regulator and on examination, the regulator has not found any actionable material, Singh added.