On Thursday, the Insolvency Amendment Bill (Insolvency and Bankruptcy Amendment Bill, 2020) protecting investors buying bankrupt companies from criminal lawsuits was approved by the Rajya Sabha. The Lok Sabha has already passed it. The bill replaced the ordinance. Finance Minister Nirmala Sitharaman, while replying to the discussion on the bill in the Rajya Sabha, said that amendment to the bill is the need of the hour. These amendments have been made keeping in mind the order of the Supreme Court.
According to media reports, this bill was first introduced in 2016. Since then, it has been amended thrice. During the debate, most of the opposition members had repeatedly asked the Finance Minister to know the reason for the change. Also asked what the government is doing for the reality companies and those buying houses from them.
On this matter, the Finance Minister said that the government is taking care of the interests of the home buyers. And to protect the realty firms from unnecessary litigation, the IBC has included the condition of minimum number of buyers. The process of declaring companies bankrupt has been made consistent by removing the flaws in the bill. In this, measures have been taken to protect the new company buying the bankrupt firm from punishment for the actions of the bankrupt firm.
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