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Showing posts from December 12, 2017

SMEs' claims may get higher priority in liquidation cases

SMEs' claims may get higher priority in liquidation cases The government is looking at a proposal to give higher priority to the claims of small operational creditors in cases of liquidation under the bankruptcy code, an official said. This comes after representations that small and medium enterprises (SMEs), which are suppliers of goods or services to a defaulting company, face huge losses during bankruptcy proceedings, pushing them towards bankruptcy in some cases and also leading to job losses for those employed with them. "In a few cases which are presently under liquidation, it has been pointed out that SMEs face the brunt, putting them under severe stress," said the government official cited earlier. "We are examining the issue," the person said. Under the recovery of balance dues, in terms of waterfall mechanism as set out in Section 53 of the Bankruptcy Act, the order of priority for operational creditors comes under unsecured creditors. Experts say there i…

Govt asks panel to review amendment to Insolvency and Bankruptcy Code

Govt asks panel to review amendment to Insolvency and Bankruptcy Code The review committee will help the government take another look at some of the contentious issues in the IBC ordinance highlighted by the industry The government has decided to ask a panel it formed in November to review provisions of the Insolvency and Bankruptcy Code (IBC) to also review a later amendment prohibiting defaulting promoters and related entities from bidding for their assets, two people aware of the matter said. The committee, which is chaired by the secretary, ministry of corporate affairs, and includes members involved in the drafting of the IBC, met on Friday.Coincidentally, on the same day, the Punjab and Haryana high court issued a notice to the centre over the amendment. Suman Jolly, managing director of Punjab-based Recorders and Medicare Systems Pvt. Ltd, had challenged the IBC ordinance on the ground that it would have retroactive effect, and that it does not distinguish between ordinary and wil…

Sebi rejigs primary market advisory panel

Sebi rejigs primary market advisory panel Capital markets regulator Sebi has reconstituted its Primary Market Advisory Committee (PMAC), which advises it on issues related to the regulation and development of IPOs and other such segments. The 24 member panel is chaired by TV Mohandas Pai, chairman of the Manipal Global Education Services.PMAC also advises Sebi on matters required to be taken up for changes in legal frame work to introduce simplification and transparency in the primary market. The Business Standard, New Delhi, 12th December 2017