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The Insolvency and Bankruptcy Code, 2016 (IBC) stipulates a period that is 180 days which can be extended to a maximum of 330 days. In this period the Corporate Insolvency Resolution Process (CIRP) should be completed. Financial Creditor, Operational Creditor of the Corporate Debtor (CD), or the Corporate Debtor itself, can initiate the CIRP. When the CIRP is initiated by the Adjudicating Authority an Interim Resolution Professional (IRP) is appointed, who acts on behalf of the Directors of the Corporate Debtor. Role of CoC When the claims of various creditors are verified by the IRP, a Committee of Creditors (CoC) is constituted. This CoC Comprises of financial creditors and is the decision-making body for the Corporate Debtor's administration. The Code and the regulations made confer various powers on the CoC, including appointing the IRP as the Resolution Professional (RP), supervising their functioning and conduct, and even replacing the RP if the RP's conduct is not satisf...

The objective of enacting Insolvency and Bankruptcy Code, 2016 is eminent to all. However, the undefining haircut offered to the creditors in Jet Airways and Videocon has opened a pandora’s box of criticism which has eventually questioned the foundation of the code. Distressed companies undergoing CIRP have become an easy bait for the financially viable companies by which they get the assets of stressed companies at a price way below the market price. A year ago, Union Minister of State for Corporate Affairs Shri Rao Inderjit Singh in a written reply to a question in Rajya Sabha stated that 4,540 companies are undergoing CIRP out of which only 394 companies stand resolved with 36% realisation of claims by financial creditors under IBC. A common factor in all the CIRP is that the resolution professional has to run the CIRP with limited funds or mostly with no funds, though Section 14 of the Code provides some relief to the sick company by granting moratorium but the RP still has to ...