The focus of an insolvency resolution plan should be to maximise the value of the business concerned and not just to recover the dues or liquidate the company, an IBBI official said on Saturday.
The Insolvency and Bankruptcy Board of India (IBBI) is a key institution in implementing the Insolvency and Bankruptcy Code (IBC).
Speaking at an event organised by industry body Assocham, IBBI Executive Director Santosh Kumar Shukla said it is a joint effort of all the stakeholders and not only insolvency professionals for the revival of companies under financial stress.
“While we need to give full credit to the role and the responsibility of the insolvency professionals, while working out a resolution package, the other stakeholders like the committee of creditors and even the ex-management has an important role to play.
“The focus should be to maximise the value of the business and not just to recover the dues or liquidate the company,” Shukla was quoted as saying in a release issued by Assocham.
National Company Law Tribunal (NCLT) Member (Judicial) Madan Balachandra Gosavi said the committee of creditors should not look at only maximising their recovery or going in for compulsory liquidation to recover their dues during the resolution of a company but also ensure the company becomes operational again.
He also appreciated the role of resolution professionals during an insolvency process, adding that there have been instances where resolution professionals have faced murderous attacks. “There have been cases where the ex-management too, has tried to get them intimidated in false criminal cases,” he said, according to the release.