Small businesses are seeking an extension of the protection given to them from bankruptcy proceedings for defaults during the pandemic beyond the nine-month period, which expires this month. But experts are divided over the demand, while the government weighs its options.
The ministry of corporate affairs and the Insolvency and Bankruptcy Board of India (IBBI) will decide on extending the current suspension of fresh bankruptcy proceedings a few days prior to its expiry on 24 December, said two people with direct knowledge of the matter.The Centre is keen to roll out the mini bankruptcy code for small firms before fresh bankruptcy proceedings for defaults during the pandemic are allowed under the Insolvency and Bankruptcy Code (IBC). This would spare small businesses the complexities of the sophisticated regime designed for large corporations.
Courtesyg: Google (photo)
