Liquidation & Winding-up – Vinod Kothari Consultants

Far reaching changes, several strategic initiatives, bold moves to overcome impact of jurisprudence that did not seem to serve the policy framework – these few words may just approximately describe the IBC Amendment Bill. The Bill has been put to a Select Committee of the Parliament, and may hopefully come back in the Winter Session. However, the mind of the Government is clear: if a bold legal reform has faced implementation challenges, the Government will clear the roadblocks. Some extremely crucial amendments might soon see the light of day, providing much-required clarity on priority of creditors, role of AA, group insolvency, among others.

Done, dented, damaged: The IBC edifice, even before it’s 10

August 11, 2025/0 Comments/in Case laws, Insolvency and Bankruptcy, Liquidation & Winding-up, Resolution /by Staff

– Sikha Bansal, Senior Partner | resolution@vinodkothari.com

What was ushered in as a new era of legal reforms in the country, with keen interest from all over the world, is now a bruised, battered structure, even before it cuts its cake for the 10th time.

The BLRC Vision

When the Bankruptcy Law Reforms Committee first put the Insolvency and Bankruptcy Code, 2016 (“IBC”) into its mould, they envisaged it as a tool in the hands of creditors who should decide on the fate of a defaulting firm. As they put it, “The appropriate disposition of a defaulting firm is a business decision, and only the creditors should make it.” Needless to say, they also recognised that decision-making has to be quick – as delays lead to value destruction. Indeed, the design and structure of IBC was promising enough – a unique categorisation of creditors as financial and operational creditors (found no-where in the world) with financial creditors, a creditor-driven resolution process, strict hardbound timelines, an irreversible liquidation outcome, a well-thought of priority waterfall, and a court-appointed liquidator taking the corporate debtor to the death pyre.

Supreme Court’s Judgment in Bhushan Power and Steel Ltd.: a wake up call for the Resolution Professionals and Committee of Creditors

May 6, 2025/0 Comments/in Case laws, Insolvency and Bankruptcy, Liquidation & Winding-up, Resolution /by Staff

Team Resolution | resolution@vinodkothari.com

The Supreme Court judgement in the matter of Kalyani Transco v. Bhushan Power and Steel Ltd., set aside the resolution plan for Bhushan Power and Steel Ltd., and directed liquidation, after almost 6 years the resolution plan was approved by National Company Law Tribunal, citing significant gaps in the conduct of corporate insolvency resolution processes – for instance, lapses in meeting statutory timelines, deficiencies in eligibility verification under section 29A, irregularities in plan implementation, judicial overreach by National Company Law Appellate Tribunal, among others.

In this write up, we have made an attempt to discuss significant points of law as discussed by SC in this ruling and also provide our humble comments on the same. Needless to say, many of the concerns highlighted by the SC in this judgment would act as a binding code of conduct for all resolution professionals, CoCs, and even judicial institutions.