Page 57 - DTPA Journal Aug 18

DTPA - J | 2017-18 | Volume 3 | August 2018

Important Updates on Insolvency

and Bankruptcy Code

CA Ranjeet Kumar Agarwal, CCM, ICAI

A. Highlights of Insolvency and Bankruptcy Code 8. Minimum one-year grace period allowed for the
(Amendment) Ordinance, 2018 successful resolution applicant to fulfill various
1. Home buyers recognised as financial creditors statutory obligations required under different laws.
which would give them due representation in the 9. Moratorium period not applicable to enforcement of
Committee of Creditors (COC). guarantee.
2. MSME Sector provided with a special dispensation 10. Special resolution required for corporate debtors to
under the Code. It does not disqualify the promoter themselves trigger insolvency resolution under the
to bid for his enterprise undergoing Corporate Code
Insolvency Resolution Process(CIRP) provided he B. Change of Syllabus wide Press Release of IBBI
is not a willful defaulter and does not attract other
dt. 31st July 2018
disqualifications not related to default.
The following are the changes that are made in the
3. Withdrawal by applicant after admission under IBC
Syllabus w.e.f 1st Nov 2018 :
would be permissible only with the approval of the
Committee of Creditors with 90 percent of the 1. Rules and Regulations under IBC notified till 31st
voting share. Further withdrawal will only be October 2018 are part of Syllabus
permitted before publication of notice inviting 2. Two more Chapters added in the Companies Act
Expressions of Interest (EoI). 2013 Part: Chap- XXVIII - Special Courts and Chap-
XXIX- Punishments
4. Voting threshold has been brought down to 66
percent from 75 percent for approval of 3. In the Debt and Restructuring Part, Four SEBI
resolution plan, extension of CIRP period, etc. Regulations have been added instead of CDR,
The voting threshold for routine decisions has SDR, S4A (since RBI has withdrawn these
been reduced to 51%. Schemes)
5. Allows participation of security holders, deposit 4. In the General Awareness Part, Constitution of
holders and all other classes of financial creditors India, Right to Constitutional Remedies, Provisions
that exceed a certain number, in meetings of of Union Judiciary, Provisions of High Courts in the
the COC, through the authorized representation. States have been added
6. Section 29(A) of the IBC, 2016 has been modified to 5. The Partnership Act, 1932 now put in the Part of
exempt pure play financial entities from being Indian Contract Act, Sale of Goods Act etc.
disqualified on account of NPA. Similarly, a 6. The % weight age in total marks for each Part is
resolution application holding an NPA by virtue more or less the same, except for Companies Act
of acquiringitin the past under the IBC, 2016, 2013 Part, where 2% is reduced, in the Indian
has been provided with a three-year cooling-off Contract Act, Sale of Goods Act Part 1% increased
period, from the date of such acquisition. and in Finance and Accounts Part 1% increased.
7. The Resolution Applicant to submit an affidavit The Format, Frequency of Examination and
certifying its eligibility to bid since there is wide Examination Fees remaining the same.
range of disqualifications in Section 29(A).

www.dtpa.org Direct Taxes Professionals' Association - Journal | 54