Corporate Insolvency Resolution Process: An Overview of the Procedural Regime and its Economic Relevance

Corporate Insolvency Resolution Process governed by Insolvency and Bankruptcy Code, 2016 deals with recovery mechanism adopted by creditors against the corporate debtor. The entire process is a constant interplay of commercial wisdom and judicial discretion. It can be initiated either by Financial Creditor, Operational Creditor or Corporate Debtor himself. Once it is accepted an interim resolution professional will be appointed and he convenes a Committee of Creditors. With the approval of Committee of Creditors, a resolution professional will be appointed, who invites resolution plans from resolution applicants. The one plan which is passed by Committee of Creditors will be sent to National Company Law Tribunal for approval. This process is guided by constant overview of National Company Law Tribunal and each step is interpreted in multiple ways by the judiciary. Moreover, the economic relevance of this process with particular focus on a developmental comparison before and after 2016 is given. In particular the decision in the matter of Essar Steel Insolvency Case and its impact in the Indian economy is analysed in detail.