Rajya Sabha passes Insolvency and Bankruptcy Code (Second Amendment) Bill 2020

Rajya Sabha passes Insolvency and Bankruptcy Code (Second Amendment) Bill 2020

On Saturday, Finance Minister Nirmala Sitharaman responded that the Insolvency and Bankruptcy Code (Amendment) Ordinance was brought into consideration given the unprecedented situation created by the Covid-19 epidemic.

The Second Amendment Bill 2020, the Code of Insolvency and Insolvency, was passed by the Rajya Sabha today with a view to providing relief to entrepreneurs of the unprecedented situation caused by the Corona epidemic.

He said that due to the situation caused by the epidemic, there was a demand of time that immediate steps should be taken and that is why the path of the ordinance was adopted. Mrs. Sitharaman said that the government brought the bill in this session to make the ordinance a law.

In the perspective of the lockdown executed due to the epidemic, the Finance Minister said that at that time, more vital than livelihood was to be protected. It affected the people as well as the economy, but saving the lives of common people was more important. She said that people were aware of the problems caused and the government took several steps.

Referring to the Insolvency and Insolvency Code, she said that it is a good change and has succeeded in fulfilling its purpose. She said that now companies are trying to resolve their cases without going to NCLT.

The Finance Minister said that the recovery rate of IBC is better than other agencies. The rate has been 42.5 per cent in IBC while it is 5.3 per cent in Lok Adalat, 3.5 per cent in DRT and 14.5 per cent in SARFAESI.

Following the Minister’s reply, the House passed the Bill by voice. Simultaneously, the House rejected the resolution moved by CPI (M) member KK Ragesh, which proposed to reject the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2020.

By Priya Kumari