A year later, the Insolvency and Bankruptcy Code is still work-in-progress

Bankruptcy proceedings continue to drag on in several cases beyond the expected time-frame, with borrowers and unsuccessful bidders challenging the process in civil courts

The Insolvency and Bankruptcy Code (IBC) introduced by the Narendra Modi government in December 2016 to fix the banking sector’s bad loans problem has over the last 16 months been a mixed bag, with borrowers and disgruntled bidders increasingly exploiting vagueness in some key provisions of the code to stall bankruptcy proceedings.

The financial bidding process was expected to be wrapped up by the end of January 2018 for 12 large corporate loan accounts referred by the lenders to the National Company Law Tribunal (NCLT) following the Reserve Bank’s of India’s (RBI) directive last year. These companies together account for