Amendments to the IBC: Correcting judicial errors

The operational creditors cited the NCLAT's decision on July 4, 2019, in Standard Chartered Bank vs Satish Kumar Gupta, R P of Essar Steel

Often, courts step in to lend direction when new statues lack clarity or are inconsistently interpreted. In other cases, the legislature steps in to remedy errors that find their genesis in judicial errors and shortcomings lending an interpretation inconsistent with objects of the statute. Two such recent amendments to the Insolvency and Bankruptcy Code (IBC) fall into the latter category.

The first is to Section 12 of the IBC. Despite the Supreme Court stressing the importance of statutory timelines (in its October 2018 judgment in the Arcelor Mittal case), including model timelines under Regulation 40A, it observed elsewhere in the same