Scrap Ill-conceived Insolvency and Bankruptcy Code (IBC), 2016!
SScrap Ill-conceived Insolvency and Bankruptcy Code (IBC), 2016!
Scrap Ill-conceived Insolvency and Bankruptcy Code (IBC), 2016!
Posted on 14th June, 2024 (GMT 21:06 hrs)
Updated on 15th June, 2024 (GMT 17:17 hrs)
Compiled by Partyless Society⤡ & Occupy Dalal Street⤡
I. Introduction
This compilation concentrates on a special act introduced by the Modi Sarkar 1.0, viz., the Insolvency and Bankruptcy Code (2016) or IBC, 2016, a brainchild of the then Finance Minister, Mr. Arun Jaitley. Here, in this article, we are going to discuss the drawbacks, flaws, setbacks and amendments of this Code by analyzing its eight-year long history. The authors of this compilation or collage will try to understand the sufferers’ painstaking existence due to the elusive implementation of the said Code.
India had numerous acts before the advent of the IBC, which are similar in character, all of which were aimed to punish the defaulters. Those acts include: the Indian Contract Act, the Recovery of debts due to Banks and Financial Institution Act 1993, the Securitizations and Reconstruction of Financial Assets and Enforcement of Security Interest Act (SARFAESI), 2002, the Sick Industrial Companies (Special Provisions) Act, 1985 (SICA). (SOURCE: VIEW HERE ⤡)
A sceptic mind can question that why such ill-conceived code (to be discussed soon) was introduced despite the existence of such laws beforehand to protect the investors, creditors and debtors in the event of insolvency?
The following poster may be understood as a biased opinion of the authors. However, as always, prologue is written only after the analysis of any phenomenon or object of study is completed.
First things first, what is the chronology of this IBC, 2016? When was it conceived and brought forth as a bill and then turned into an act?
| DATE | EVENT |
| 22nd August, 2014 | The Ministry of Finance created the Bankruptcy Legislative Reforms Committee (BLRC). The committee was headed by T. K. Viswanathan, and tasked with drafting a new bankruptcy law. |
| 4th November, 2015 | The Committee submitted its report, which included a draft bill. A modified version of the draft bill, after the incorporation of public comments, was introduced in the Sixteenth Lok Sabha by Finance Minister Arun Jaitley as the Insolvency and Bankruptcy Code, 2015. |
| 23rd December, 2015 | The bill was tabled. A Joint Parliamentary Committee on the Insolvency and Bankruptcy Code, 2015 (JPC) was set up and the bill was referred to it for detailed analysis. |
| 28th April, 2016 | The JPC submitted its report, which included a new draft of the Bill. |
| 5th May, 2016 | It was passed by the Lok Sabha. |
| 11th May, 2016 | It was passed by the Rajya Sabha. |
| 28th May, 2016 | It received assent from President Pranab Mukherjee and was notified in The Gazette of India. IBC thus became an Act. |
Reading the claims made by Mr. Jaitley in the above speech, one has to look beneath the surface-level announcements in order to understand the character of the IBC, 2016. For this purpose, the following sections are being laid out.
II. Bill Passed (Away) Without Dialogue
Despite the fact that the IBC apparently underwent the procedure from being a bill to being an act across two long years, the other bills and acts proposed during the periods of Modi sarkar 1.0 as well as 2.0 did not follow the proper lengthy procedure, which is enriched by discussions, questions/counter-questions, debates etc., by Opposition Parties as well as Parliamentary Committees (if formed). As was observed throughout Modi 2.0, all dissenting voices were suppressed or suspended from the Parliament and bills were passed immediately upon their introduction without the indispensable, constitutionally-necessary “question hour”.
Bills getting passed without debate, Parliament to soon become rubber stamp: Former Madras HC judge VIEW HERE ⤡ (As reported on 6th December, 2021 ©The Economic Times)
Amid suspension of Opposition MPs, Parliament passes key Bills without debate VIEW HERE ⤡ (As reported on 18th December, 2023 ©Deccan Herald)
Purge being executed so that draconian bills passed without debate: Cong VIEW HERE ⤡ (As reported on 19th December, 2023 ©Business Standard)
This was reflected in former CJI N. V. Ramana’s comment during the first three years of Modi 2.0:
‘Sorry state of affairs’: CJI N V Ramana on lack of debate in Parliament VIEW HERE ⤡ (As reported on 15th August, 2021 ©The Economic Times)
Now, all the Indian citizens understand that no majoritarian, autocratic system can sustain without discursive dialogue or inputs from pluralistic federal units. It is strange enough to note that the forming of IBC took almost two years to be implemented. Despite this fact, it has cut a sorry figure in meeting its feigned promises. It is also to be noted that within this period, the then ruling party of India allowed 50+ superrich wilful defaulters to fly away from the country without meeting their loan obligations.
After the upsetting results on 4th June, 2024 for the BJP, the RSS (the father organization of the BJP) curiously attacked the BJP’s “over-confidence” and “arrogance” as well as emphasized on the need for plural and diverse voices:
Mohan Bhagwat’s Speech Confirms That RSS’ ‘Open Licence’ to Modi is Under Review VIEW HERE ⤡ (As reported on 14th June, 2024 ©Quint)
Modi 3.0: Why BJP must embrace Mohan Bhagwat’s message for unity and inclusive governance VIEW HERE ⤡ (As reported on 14th June, 2024 ©Firstpost)
Senior RSS leader attacks BJP on Lok Sabha election results: ‘Those who became arrogant…’ VIEW HERE ⤡ (As reported on 14th June, 2024 ©Business Today)
However, it is too late to pronounce such syncretic statement as almost one progeny has already been destroyed by the misruling of the RSS-BJP collusion. This brings us to the contingencies involved in the framing of the IBC by the Modi 1.0 and 2.0, including the 35+ amendments that the Code saw within the period of 2016-2024.
III. Amendments of the IBC (2016): An Overview
If anyone considers the IBC as an omniscient, omnipresent and omnipotent law introduced under the leadership of a self-proclaimed non-biological messianic prophet or avataar, why are there so many amendments within the span of 7-8 years? Let us look through some of the major amendments thus introduced, which prove the fluid, uncertain and confused state of the Code:
“2017 Amendment prohibits certain persons from submitting a resolution plan in case of defaults. These include: (i) wilful defaulters, (ii) promoters or management of the company if it has an outstanding non-performing debt for over a year, and (iii) disqualified directors, among others. Further, it bars the sale of property of a defaulter to such persons during liquidation.” (Source: Wikipedia⤡)
The year 2018 also saw several amendments, e.g.:
- Homebuyers are now classified as financial creditors.
- Revisions to Section 29A, easing criteria for resolution applicants.
- Permitting withdrawal of ongoing Corporate Insolvency Resolution Process (CIRP) with 90% creditor approval.
- Lowering Committee of Creditors’ voting thresholds.
- Mandating special resolutions for companies initiating their own CIRP.
- Applying the Limitation Act to IBC cases.
SOURCE: Major Amendments introduced to the Insolvency and Bankruptcy Code VIEW HERE ⤡ (As reported on 20th July, 2018 ©AZB Partner
s)
Further, in the year 2020, the Insolvency Amendment Act was notified on 13th March 2020, with a retrospective effect, being in force with effect from 28 December 2019 and bringing about significant changes to various sections of the Code:
- Raising the default threshold for initiating Corporate Insolvency Resolution Process (CIRP) from INR 1 lakh to INR 1 crore.
- Expanding definitions and clarifying roles in sections 5, 7, 11, 14, 16, 21, 23, and 29A.
- Introducing Section 32A, protecting new management from prior offenses.
- Enacting Section 10A, temporarily suspending CIRP initiation due to COVID-19.
- Adding Section 66(3), limiting fraudulent business claims during the CIRP suspension.
In the year 2021: “The Insolvency and Bankruptcy Code (Amendment) Act 2021 introduced a pre-packaged insolvency resolution process for micro, small, and medium-sized enterprises (MSMEs). The process allows for a shorter timeline of 120 days and enables MSMEs to work on resolution plans while remaining in possession of the company.” SOURCE: VIEW HERE ⤡
In the years 2023-2024, a number of crucial amendments were introduced, which are briefly summarized as follows:
Changes to the Insolvency Resolution Process:
- Mandatory Submission: The Committee of Creditors (CoC) must mandatorily submit a resolution plan within 330 days.
- Swift Process: Emphasis on the expedited resolution process, reducing delays and improving efficiency.
Role of the Committee of Creditors (CoC):
- Enhanced Powers: The CoC has been given greater control, including the ability to replace the interim resolution professional (IRP) with a new one.
- Recommendation Consideration: The CoC’s recommendations now hold significant weight in the decision-making process.
Debtor-In-Possession (DIP) Model:
- Introduction of DIP: A Debtor-In-Possession model is introduced, where the debtor continues to manage the business while undergoing insolvency proceedings, provided there is no fraudulent activity involved.
- CoC Supervision: Under the DIP model, the CoC supervises the debtor’s actions to protect creditors’ interests.
Streamlining Liquidation:
- Simplified Liquidation: Procedures for liquidation are simplified, including clear timelines and reduced procedural complexities.
- Liquidator’s Role: The liquidator’s responsibilities are clarified, with a focus on maximizing the value of the debtor’s assets for creditors.
Resolution Plan Approval:
- Quick Approvals: Resolution plans are to be approved more swiftly, ensuring that the insolvency process does not drag on unnecessarily.
- Transparency: The approval process emphasizes transparency and adherence to regulatory standards.
Enhanced Protection for Creditors:
- Secured Creditors: Enhanced provisions for secured creditors to ensure they receive fair treatment in the distribution of proceeds.
- Priority Payments: Priority of payments in the resolution process is clearly defined, giving creditors better insight into their expected recoveries.
Technological Integration:
- Digital Processes: Adoption of digital platforms and technologies to streamline filing, monitoring, and reporting within the insolvency framework.
- Efficiency Gains: Aimed at increasing efficiency and reducing administrative burdens.
Revised Compliance and Reporting Standards:
- Stricter Compliance: More stringent compliance requirements for insolvency professionals and entities involved in the process.
- Regular Reporting: Enhanced reporting obligations to improve oversight and accountability.
SOURCES: Insolvency and Bankruptcy Code (Amendment) Act, 2023 VIEW HERE ⤡ (As reported on 11th October, 2023 ©FreeLaw)
Important Amendments Under IBC: 2023 & 2024 – Volume III VIEW HERE ⤡
We can see that the IBC has always remained a subject of modifications and revisions over the course of eight years. This proves that the IBC at the moment of its conception was far from being the exhaustive, unstained, non-contaminated ideal that Mr. Jaitley had claimed multiple times. The compilers have suffered as well as struggled enough in the information age (in the context of speed capitalism) while bringing together these different amendments in one place, since the amendments have often argued about the same issues again and again from different vantage points and are also quite a many in number.
The issue of amendments of IBC leads us to the consideration of its flaws, setbacks, shortcomings and imperfections that caused these amendments to be issued in the first place.
IV. Drawbacks/Flaws of the IBC (2016)
Given below are some of the overt problematic areas of the IBC, compiled from different authentic sources. Let us start with Mrs. Sucheta Dalal’s take on the IBC’s present status as representing the rotten core of the Indian economy:
It would now be worthwhile to bring into attention the key negative issues with the IBC:
- Limited Judicial Bench Strength: The National Company Law Tribunal (NCLT) and National Company Law Appellate Tribunal (NCLAT) are understaffed, leading to delays in case resolutions. This shortage exacerbates the backlog and extends the time taken to resolve insolvency cases.
- Operational Delays: Procedural delays in the resolution process, partly due to insufficient infrastructure and manpower, affect the timely resolution of cases, which is critical for the effectiveness of the IBC.
- Unpredictability in Outcomes: Inconsistencies in judicial decisions create uncertainty, impacting stakeholders’ confidence and the predictability of the insolvency resolution process.
- Low Recovery Rates: The recovery rates under the IBC are relatively low compared to global standards, questioning the effectiveness of the process in terms of value maximization for creditors.
- Haircuts for Financial Creditors: Significant reductions (haircuts) in the value recovered by financial creditors have been a concern, affecting the willingness of financial institutions to participate in the resolution process.
- Resolution Plans and Bidding Process: Issues related to the submission and approval of resolution plans, including concerns about transparency and fairness in the bidding process, have been highlighted.
SOURCE: Concerns over Insolvency and Bankruptcy Code, 2016 VIEW HERE ⤡ (As reported on 11th January, 2014 ©Drishti IAS)
Moreover, certain other shortcomings are also worth noticing:
- Inadequate Safeguards: Lack of protections for company rights before management handover.
- Overreliance on Creditors: Excessive dependence on creditors’ decisions.
- Limited Representation: No provision for corporate debtor representation.
- Professional Criteria: Insufficient criteria for insolvency professionals.
- Information Access: Unrestricted access to sensitive information.
- Resolution Definition: Ambiguity in defining resolution applicants.
- Liquidation Default: Automatic liquidation if no consensus is reached.
- No Withdrawal: Prohibition on application withdrawal post-admission.
SOURCE: Flaws in IBC VIEW HERE ⤡ (As reported on 12th August, 2017 ©Shankar IAS Parliament)
Even so, the following setbacks remain as of now:
“The IBC aimed to enforce judicial discipline by introducing strict timelines for insolvency resolution processes. However, the average time taken for corporate insolvency resolution processes (CIRPs) has exceeded the stipulated timeline of 330 days, resulting in delays and erosion of value for creditors. The disruptions caused by the COVID-19 pandemic further exacerbated these delays. Additionally, a significant number of CIRPs have resulted in liquidation rather than resolution plans, indicating challenges in achieving successful outcomes. Despite challenges, the government and the Insolvency and Bankruptcy Board of India (IBBI) have proactively responded to issues by amending the legislation and regulations. The IBC has undergone frequent amendments to address various challenges, although some amendments have led to confusion.”
SOURCE: Understanding India’s Insolvency and Bankruptcy Code: Challenges and Opportunities VIEW HERE ⤡
The following source highlights the sorry states of affairs of the IBC, 2016:
SOURCE: Anything that can go wrong may have gone wrong with IBC VIEW HERE ⤡ (As reported on 15th February, 2024 ©Fortune India)
The “hits and misses” of the supposedly “all-powerful” IBC can be viewed clearly below, since people mark when they hit but they do not mark when they miss:
SOURCE: India’s Insolvency and Bankruptcy Code is not working; here’s what’s going on VIEW HERE ⤡ (As reported on 6th August, 2023 ©Business Today)
The following links may be visited for eliciting further details to this end:
IBC report card: It’s win some, lose some for the bankruptcy law VIEW HERE ⤡ (As reported on 28th June, 2022 ©The Federal)
IBC turns 5: Hits and misses of the Insolvency and Bankruptcy Code VIEW HERE ⤡ (As reported on 20th August, 2021 ©The Economic Times)
This type of ambivalent attitude of the lawmakers makes the common people miserable, whilst their docile bodies are subjected, subjectified and objectified through such harsh (as well as fluctuating) mechanisms of law!
The spokesperson in the above video has implicatively pointed out the following three sections of the IBC (Section 12A, Section 29A and Section 53) that are incommensurable with the constitutional values of the Republic of India; this hampers the Fundamental Rights, especially Article 14 of the Indian Constitution, which states: “The State shall not deny to any person equality before the law or the equal protection of the laws within the territory of India.” (Some petitioners in the DHFL case⤡⤡ are spreading a rumour that only petitioners will get back their invested amount. This is in contravention to the Article 14).
Let us view the summary of each of the aforementioned sections that function in favour of the superrich crony business tycoons at the cost of the small depositors:
Section 12A of the IBC allows for the withdrawal of an insolvency application that has been admitted under sections 7, 9, or 10. This withdrawal can occur if the applicant requests it and receives approval from 90% of the voting share of the Committee of Creditors (CoC). This provision was introduced to supposedly/presumably provide flexibility in the insolvency process, enabling parties to settle disputes and avoid prolonged proceedings.
Section 29A of the IBC, which outlines the criteria that disqualify certain individuals and entities from being resolution applicants. These include undischarged insolvents, wilful defaulters, those convicted of an offense punishable with imprisonment of two years or more, and related parties of such individuals or entities. The purpose is to ensure that only credible and financially sound applicants can participate in the insolvency resolution process.
Section 53 of the IBC details the distribution of assets during liquidation. It prioritizes payments to secured creditors and workmen’s dues, followed by unsecured creditors, government dues, and other debts. This is done to supposedly/presumably ensure a systematic and fair distribution of the debtor’s assets to satisfy given claims.
Moreover, the issue of Section 32A of the IBC remains. This was specially observed in the infamous DHFL Scam, in which the following took place:
Mr. Ajay Piramal, after allegedly “owning” the Dewan Housing Finance Corporation Limited (DHFL), refused to take the burden of so-called “prior offences” by alluding to the Section 32A (2019 amendment) of the IBC (2016), which states:
“[32A. Liability for prior offences, etc.–(1) Notwithstanding anything to the contrary contained in this Code or any other law for the time being in force, the liability of a corporate debtor for an offence committed prior to the commencement of the corporate insolvency resolution process shall cease, and the corporate debtor shall not be prosecuted for such an offence from the date the resolution plan has been approved by the Adjudicating Authority under section 31…”
In other words, the PCHFL aka Piramal Finance that allegedly “acquired” the DHFL argued by citing the Section 32A that the said legal provision prohibits the existence of an FIR and the criminal proceeding arising out of it against the new management, after the “successful completion” of the corporate insolvency resolution process (CIRP). Hence, sins are not to be “carried forward”!
SC notice to CBI on Piramal Capital & Housing Finance plea to quash FIR VIEW HERE ⤡ (As reported on 26th February, 2023 ©Business Standard)
Mr. Ajay Piramal can never be a “Saint” Vālmiki. Instead of singing out “mā niṣada pratiṣṭham tvamagamahaḥ” by seeing the DHFL victims suffer a “capital” punishment after undergoing massive haircuts under the IBC, he is actually playing the role of niṣāda or the hunter, the one who killed two innocent birds engaged in loving intimacy. Nevertheless, he has forgotten the burden of his past deeds.
Moreover, Mr. Piramal has forgotten all about the Section 66 of the IBC that provides for the benefit of all the creditors in the recovery of avoidance transactions. He has financially abused the DHFL victims by looting their life-savings with the help of the then ruling party, i.e., the BJP.
Without any liability, he “bought” (?) an AAA rated, 45k crore worth company by paying only a rupee after five contradictory (seemingly simulated) bidding wars between three final bidders!
https://onceinabluemoon2021.in/2023/10/28/the-narratives-of-dhfl-betting-sorry-bidding/
This is an adverse possession of a solvent, ongoing concern. Without putting in much labour (and zero amount of socially necessary labour!), one can “buy” a company with an entire infrastructure along with all the employees without bothering about the legality of the affairs!
However, the Hon’ble Supreme Court of India had earlier pointed out:
Bankruptcy will not void personal guarantees: Hon’ble Supreme Court VIEW HERE ⤡ (As reported on May 22, 2021 ©The Times of India)
In other words, the old promoters’ rights in the occasion of a “bankruptcy” or “insolvency” shall not be extinguished but are to be upheld as a continuation.
The SCI is still maintaining such a stance with regard to the old promoters’ rights, in so far as there are still no “escape routes” for the “new owner” of a company without reconsidering the old promoter’s appeals in response to the initiation of the corporate insolvency resolution process (CIRP).
Anil Ambani, Dhoot, Biyani may face heat after SC ruling on personal guarantors VIEW HERE ⤡ (As reported on 16th November, 2023 ©ET BFSI)
SC denial of IBC relief to personal guarantors opens new recovery window for lenders VIEW HERE ⤡ (As reported on 13th November, 2023 ©Economic Times)
Supreme Court Upholds Constitutionality Of IBC Provisions Relating To Personal Guarantors; Says Adjudicatory Role Can’t Be Read Into Sec 97 VIEW HERE ⤡ (As reported on 9th November, 2023 ©LiveLaw)
https://onceinabluemoon2021.in/2023/11/26/ajay-piramal-the-owner-of-the-erstwhile-dhfl-really-so/
The above flaws comprehend the fact how the multiple-times amended sections/provisions/portions of the IBC are often in conflict, e.g., one section preserves the rights of all stakeholders (Section 66(1)) in the long run while another provides way to the profiteering benefits of the “new” owner after the CIRP (Section 32A). How to reconcile all these conflicting issues then? Not only that, many such provisions of the IBC also enter into contradictions with the RBI Act, NHB Act and Company Act. Even the public servants have made mistakes in the course of IBC-run insolvency process and those have been pointed out by the NCLT and NCLAT. The CoC’s decision stood still as in the case of DHFL due to the challenging verdicts or orders of such adjudicating authorities.
See the following timeline to see how the various tiers of these adjudicating authorities often contradict themselves in the interpretation of the IBC-sanctioned CIRP, as was observed again and again in the DHFL case:
| 19.05.2021 | The NCLT ordered the CoC to reconsider DHFL’s erstwhile promoter Wadhawan’s offer of 100% repayment within 10 days. NCLT order on the DHFL-case ⤡ [IA 2431 of 2020 in CP (IB) 4258/MB/C-II/2019 Under Section 60 (5), 227 (2), 239 of the Insolvency and Bankruptcy Code, 2016] points 16-19 and 84-89. |
| 25.05.2021 | NCLAT set aside NCLT’s order after the Union Bank of India and Ajay Piramal approached the NCLAT with an urgent petition. The CoC did not even bother to answer the NCLT. HOW DID MR. AJAY PIRAMAL GET SUCH JUDICIAL PRIVILEGE IN NCLAT, GIVEN THE NUMBER OF PENDING CASES IN THE INDIAN COURTS? Piramal is more equal than the other 98%!VIEW HERE ⤡ |
| 07.06.2021 | NCLT is forced to approve the resolution plan in favour of the Piramals. |
| September 2021 | Mr. Ajay Piramal started disbursing merely 23% of the total FD amount to the respective FD Holders of DHFL, the rest of the amount going for a major haircut. Financial deprivation (curtailment of business-related human rights due to financial abuse) of thousands of FD and NCD Holders is apparent. |
| 27.01.2022 | Following the case filed by 63 Moons Technologies (the case questioned the deal of Piramal’s resolution plan, wherein the approx. 45k crore worth of assets were bought by paying only a rupee. 63 Moons cited the Section 66 of the IBC, which provides for the benefit of all the creditors of the insolvent company) the NCLAT passed an order that declared the illegality of the DHFL CoC, its conduct and the allocation of the resolution amount as well. NCLAT asks CoC to consider 63 moons’ plea in DHFL Resolution Plan VIEW HERE ⤡ (As reported on 27th January, 2022 ©The Times of India) |
| 01.03.2022 | Piramal approached the Supreme Court, challenging the NCLAT Second Order. |
| 11.04.2022 | The Supreme Court stayed the NCLAT Order. Despite the fact that the case is under adjudication or sub judice, Piramal CHF acquired DHFL by using dubious company names: Piramal CHF and Piramal Finance. |
This further reflects the IBC’s lack of clarity in guiding any resolution process, since it enables the chosen few mercilessly.
One of the OBMA founder-members had tried to challenged the legitimacy of the IBC at the Supreme Court of India in connection with the DHFL Scam in 2021-22. However, the same was dismissed after being listed chiefly for two reasons:
The case could not be continued:
a) Crunch of money in the expensive realm of the Indian judiciary;
b) Due to some black-sheep within the group installed by the opponents.
Black Sheep: The Adversaries of the DHFL Victims’ Movement VIEW HERE ⤡
V. Conclusion: Scrap IBC!
In conclusion, it is transparent that the IBC is a product of anti-people collusion of crony, savage, cannibal capitalists with the underworld and the ruling party. In the context of such an Orwellian dystopia, we are facing a peculiar word “non-performing assets” (NPA), a doublespeak, or an instance of uncontradictory contradictory since if “X” is non-performing, how can it be considered an “asset” per se? This type of doublespeak or Newspeak of Oceania reveals the ambiguous, tautologous and contradictory nature of the IBC. Even the 45k crore=1 rupee equation in the DHFL case was such a curious case made possible by the very paradoxical character of the IBC.
It is as much a case of failure as the farmers’ bills, electoral bonds scheme, demonetization, PMLA, Article 370 abrogation, GST etc., all of which were either thoroughly questioned, challenged or simply scrapped in the face of public agitation, movement or civil disobedience, or merely in the course of the concerned law/policy’s implementation. In a similar way, the IBC needs to be challenged, its key provisions that favour the profiting-motives of a few corporate tycoons must be changed to stand in defence of the small investors and/or depositors.
In fact,
Centre likely to review IBC Bill only after 2024 general elections VIEW HERE ⤡ (As reported on 19th December, 2023 ©Business Standard)
Especially after:
Madras High Court Urges Parliament To Assess Efficiency Of IBC And Consider Recovery Percentage From Successful Resolution Processes VIEW HERE ⤡ (As reported on 9th June, 2024 ©LiveLaw)
In this connection, noted financial investigative journalist Mrs. Sucheta Dalal noted in a March 2024 article:
“Last month, the Madras High Court responded to a petition filed by a chartered accountant and insolvency professional (IP), V Venkata Siva Kumar, by seeking a response from the Union government to charges of corruption at the NCLT’s Chennai bench. Mr Siva Kumar, who appears in person, contends that the country has lost several lakh crores of rupees due to corrupt and collusive decisions. He has sought a ‘monitoring mechanism’ for the work of adjudicating officers, given that large sums of money are at stake in every case.
Even earlier, Mr Siva Kumar had alleged that a specific technical officer of the Chennai bench had assumed full authority over the adjudication process and would decide matters in favour of ‘the highest bidder’ with negotiations taking place in his chambers without any documentation of their interactions. He had alleged that petitions of select senior counsel were entertained while those of others, particularly juniors, were shouted down and silenced.
Mr Siva Kumar, who has been doggedly recording and highlighting instances of corruption at the NCLT and its appellate body for over two years, has made the ministries of corporate affairs, law and justice as well as the central vigilance commission as respondents.”
SOURCE: Courts Step Up as Legislative Amendments to IBC Remain Elusive VIEW HERE ⤡ (As reported on 1st March, 2024 ©Moneylife)
Even earlier in 2021-22, it was urged that:
Standing Committee on Finance raps IBC over unsustainable haircuts, says 13,000 cases worth Rs 9 lakh crore pending VIEW HERE ⤡ (As reported on August 03 2021, ©Moneycontrol)
IBC: Govt. working with RBI on CoC’s conduct VIEW HERE ⤡ (As reported on 27th August, 2021 ©The Hindu, PTI)
Impossible to accept 95% haircuts for banks under IBC: Sitharaman VIEW HERE ⤡ (As reported on 1st October, 2022 ©The Hindu)
Now, for the last words of this lengthy but substantially enriched post.
An Appeal to the DHFL Victims
Dear DHFL Victims,
After going through this entire collage by deploying your sravana, manana and nididhyasana (listening-internalizing-deeply contemplating), we have a few things to say to you on which you must reflect upon.
We, the DHFL victims, the helpless small depositors of the first NBFC to enter the problematic zone of the IBC, are now standing in front (or inside? The demarcating fine line has been obliterated) of the huge gates of the Arun Jaitley Stadium, refurnished and refurbished using tax-payers’ money to suit the BJP’s dirty politics of spectacle. The stadium appears to our sufferers’ gaze as the huge metaphorical experimenting lab of the then Finance Minister, as part of a crony machinery that has never cared about our miseries.
Oh Victims. Don’t submit yourself to the tyrannical hands of these brutes: the few superrich blood-suckers, who treat you like sacrificial fodder, turn you into petty guinea pigs and render your existential value insignificant!
By this time, it has become clear to all of us that the RBI-appointed CoC has killed us by taking away our alms arms and turning them against our legitimate concerns and interests.
Your hard-earned money has been subsumed and utilized to sue you by manipulating all the administrative, judicial and bureaucratic apparatuses. A sum of Rs. 100 Cr has been allotted to the Resolution Professionals to defend themselves against the cases we lodge.
To resist this reign of merciless state-corporate abuse, turn the present struggle into a non-violent civil disobedience movement either physically or as a digital-nomad or as a keyboard warrior. Don’t be discouraged by some of the illusory “fellow” victims of the DHFL, who are trying to disband the collective strength of the movement by installing agents from time and again.
The DHFL scam is a political matter, and must be dealt with in terms of a politically conscious war at all fronts, from all sides – through an all-out attack, following the tactics of Total Football.
You are not alone. You have the Constitution of India by your side, and also the International Human Rights’ provisions. You have nothing more to lose in this battle. So, don’t be apathetic. It is not the time to lose hope. Our identified enemies, BJP and Co., are facing a huge legitimation crisis after the declaration of the Lok Sabha Election results. They are at their weakest point now. We must strike the blow whilst the iron is still hot. It is high time we do that without any hesitation, without any excuse. We have all the weapons at our disposal to fight back against the Goliath of fascist politicians and chosen ones of the corporate world.
SEE ALSO:
https://onceinabluemoon2021.in/2023/04/20/hope-or-no-hope-the-dhfl-disaster/
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