Home Legislation Ordinance Govt. Brings IBC Amendment Ordinance; No Fresh Insolvency Proceedings for COVID-19 Period

Govt. Brings IBC Amendment Ordinance; No Fresh Insolvency Proceedings for COVID-19 Period

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The Central Government on Friday promulgated Insolvency and Bankruptcy (Amendment) Ordinance, 2020 to amend the Insolvency and Bankruptcy Code (IBC) whereby fresh insolvency proceedings will not be initiated for at least six months starting from March 25 amid the COVID-19 pandemic.

The Ordinance has introduced new Section 10A to suspend initiation of corporate insolvency resolution process.

“Notwithstanding anything contained in Sections 7, 9 and 10, no application for initiation of corporate insolvency resolution process of a corporate debtor shall be filed, for any default arising on or after 25th March, 2020, for a period of six months or such further period, not exceeding one year from such date, as may be notified in this behalf.

Provided that no application shall ever be filed for initiation of corporate insolvency process of a corporate debtor for the said default occurring during the said period.” the ordinance read.

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