What is considered as a must to do amendment, the IBBI (Insolvency and Bankruptcy Board of India) has by introduction Regulation 40C to the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 made it a necessary exclusion to exclude Period of lockdown from timeline under IBC if activity in relation to CIRP could not be completed due to the lockdown
In effect , effective from 29th March 2020, the period of lockdown imposed in the wake of COVID-19 outbreak shall not be counted for the purposes of the time-line for any activity that could not be completed due to such lockdown, in relation to a corporate insolvency resolution process under the Insolvency & Bankruptcy Code, 2016. The amended regulation henceforth reads as uder;
40C. Special provision relating to time-line.
“Notwithstanding the time-lines contained in these regulations, but subject to the provisions in the Code, the period of lockdown imposed by the Central Government in the wake of COVID-19 outbreak shall not be counted for the purposes of the time-line for any activity that could not be completed due to such lockdown, in relation to a corporate insolvency resolution process.”
The Notification shall be published in the Gazette of India as soon as the Government Press accepts the same for publication.
It is an important amendment under the scenario. With complete lock down and an handicapped judiciary due to abandoned hearing of proceeding, the practicing professional and legal fraternity are under no/little position to carry out their designated function. This amendment will therefore enable to complete their function in the eventuality of the lock down is withdrawn and economy comes back to track.
For the relevant notification may please browse