In a big relief to MSME promoters, the latest amendments brought into the Insolvency and Bankruptcy Code (IBC) will allow them to bid for their enterprises which are undergoing Corporate Insolvency Resolution Process (CIPR).
In a big relief to MSME promoters, the latest amendments brought into the Insolvency and Bankruptcy Code (IBC) will allow them to bid for their enterprises which are undergoing Corporate Insolvency Resolution Process (CIPR). However, the person should not be a wilful defaulter and doesn’t not attract other disqualifications which make him ineligible for doing such. The amendment will allow further exemptions or modifications for the sector, if required, in public interest, the government said.
On Wednesday, President Ramnath Kovind gave assent to the ordinance making amendments to the Insolvency and Bankruptcy Code (IBC), which will also recognise the status of home buyers as financial creditors. “It will also enable home buyers to invoke Section 7 of the Insolvency and Bankruptcy Code (IBC), 2016 against errant developers. Another major beneficiary would be Micro, Small and Medium Sector Enterprises (MSME), which form the backbone of the Indian economy as the biggest employer, next only to the agriculture sector,” the official statement said.
This ordinance provides homebuyers recognised homebuyers as financial creditors giving significant power to them. Now the homebuyers will be an integral part of the decision making process as they get representation in the Committee of Creditors.
With respect to the MSME sector, the latest amendments also give power to the central government to allow further exemptions or modifications, if it is required in the public interest, the official release added. “The Ordinance also provides for a mechanism to allow participation of security holders, deposit holders and all other classes of financial creditors that exceed a certain number, in meetings of the Committee of Creditors, through the authorized representation,” the release said.
After agriculture sector, micro small and medium enterprises (MSMEs) are the largest employment provider in the country and hence form the backbone of the Indian economy.