Introduction to IBC — Object, Financial Institutions, Information utilities

A builder in Navi Mumbai borrows crores from a bank, stops paying instalments, and the bank's loan recovery drags on for years while other creditors, suppliers and flat buyers all line up behind it. Who gets paid first, who decides whether the company is saved or sold, and how long should it take? The Insolvency and Bankruptcy Code 2016 answers those questions with a time limit, a tribunal and a record of debts kept by a new kind of institution called an information utility.

In two minutes

The Insolvency and Bankruptcy Code 2016 consolidates the law on insolvency resolution of corporate persons, firms and individuals in a time-bound way to maximise asset value, promote entrepreneurship and credit availability and balance stakeholders' interests; it is triggered by default, run before the NCLT, and supported by information utilities registered with the Insolvency and Bankruptcy Board.

The rest of this chapter

The full explanation, the cheat sheet, every previous-year question at every mark weight, the quiz and the answer skeletons are part of Law of Banking and Negotiable Instruments on LexBlox Semester. Sign in to unlock the subject, or read Module 1 of Legal Language and Writing free.