Indian Insolvency and Bankruptcy Code, 2016 in the era of Covid-19

Abstract

The primary alarm of insolvency and bankruptcy management is to keep possible businesses in service. An optimal administration should prevent the early closure of viable businesses and should be able to revive struggling enterprises so that investments from creditors can strengthen an individual’s position. Major changes to the current system can considerably lower failure rates by reducing the number of lucrative enterprises that are liquidated. They are also linked to advantages including expanded access to low-cost borrowing, a higher credit recovery rate for creditors, and increased employee security. The corporate personality principle grants the company certain rights and liabilities. But if the liabilities on the assets of the company go beyond its income, then the company may at times even fall down. This extraordinary situation has made an impact on the insolvency regime as well. The legislature has come up with regulations to address the issues immediately in the insolvency system during this pandemic crisis. The present paper is planned to analyze the issues and problems relating to corporate insolvency declaration in India during the pandemic.