Stating that Indian courts have “two standards”, Finance Minister Arun Jaitley today said timelines prescribed in the laws enacted by Parliament are held as mandatory for the executive, but not the judiciary itself. “Conventionally, our courts always have two standards,” Jaitley said, speaking at an industry event on insolvency organised by the Ministry of Corporate Affairs. “When timelines are made for the executive, they (courts) normally maintain these are binding. But when timelines are made for judicial institutions, the courts have conventionally held that these are only directional,” he said. Citing his experience when he was law minister, Jaitley said an amendment to the Civil Procedure Code, introducing strict timelines, could not pass the muster. “We had amended the Civil Procedure Code and put strict timelines. And pat came the judgement from the Supreme Court which said courts will decide their own timetable and these are only directional which are mentioned by Parliament. These are not mandatory on us (courts),” Jaitley said. He hopes the newly-passed Insolvency and Bankruptcy Code, which lays stress on time-bound resolution of bad assets of banks, does not meet a similar fate, he said. “I do hope these (IBC timelines) do remain as mandatory and are adhered to because these are the essence of the law. Speed will help in effective implementation of the law.”
Under the IBC, National Company Law Tribunals are required to dispose of insolvency cases within 180 days, a period which can be extended by 90 days. His ministry is sensitive to the needs of NCLTs, Jaitley said, and promised to ensure that they have necessary infrastructure. “We are making special effort to ensure that the infrastructure at NCLT … is also strengthened and brought in consonance with the requirement of the law,” he said.
Insolvency and Bankruptcy Board of India chairman M S Sahoo said that it is planning to start a national insolvency professional examination for those who want to become insolvency professionals.
As many as 250 cases, including 11 of the dozen large ones identified by the RBI, have been admitted to various NCLTs so far, and one has completed full cycle after the Hyderabad bench approved a resolution plan this month, Sahoo said.