NEW DELHI : Using technology and having more manpower could help speed up the rescue of companies in bankruptcy proceedings, according to Rajesh Verma, secretary at the Ministry of Corporate Affairs.
The Ministry is currently finalizing amendments to the Insolvency and Bankruptcy Code (IBC) to make it more efficient.
Speaking at an event organized by the National Company Law Tribunal (NCLT), Verma suggested that to improve the efficiency of the IBC, the introduction of a cross-border insolvency framework in the IBC is being considered. . “Leveraging technology and filling positions are two key factors in increasing speed,” an official ministry statement quoted Verma as saying.
The government is currently in the process of filling vacancies in the NCLT to reduce the backlog of cases.
Chief Justice (Retired) Ramalingam Sudhakar, who was the main guest at the event, said that one aspect of resolving cases quickly is the development of artificial intelligence (AI) technology to bring justice more quickly. “AI can be used in case resolution, especially in case admission,” the statement quoted Sudhakar as saying.
Ravi Mital, chairman of the Insolvency and Bankruptcy Board of India (IBBI), who was present on the occasion, said that with more standardization, the speed of resolving cases can be increased. IBBI is always ready to work with NCLT to simplify the resolution process, he said.
Delays in admitting cases to court and the extent of haircuts taken by lenders when approving corporate restructuring under new management were two concerns raised by a parliamentary panel last year. The amendments under consideration by the department aim to resolve this problem. Certainly, NCLT handles not only bankruptcy cases but also other cases under the Companies Act.
The NCLT has so far settled three-quarters of the more than 83,800 cases brought before it since its inception in 2016.
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