Vol 16 (2019) - Issue 6

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Schemes Of Arrangement: A Second Chance at ‘Resolution’ for Indian Companies in Liquidation

Synopsis

The Indian framework of restructuring of stressed assets is governed by the Insolvency and Bankruptcy Code, 2016, which was introduced to address chronic delays and dismal recoveries rampant in the system. To that end, it envisages an irreversible and time-bound liquidation process. Independently, the companies law has provided for court-approved schemes for reorganisation of failing concerns, including those undergoing liquidation, for several years now. Recently, the two regimes have overlapped with liquidators appointed under the insolvency regime being directed to obtain schemes for the entity in liquidation. In this backdrop, this article examines critical issues in the implementation of schemes in liquidation in the context of IBC.