IBBI today announced relief measure for CIRP provisions under IBCode 2016 by inserting a new regulation 40C in the CIRP Regulations. The new regulation prescribes that notwithstanding the timelines contained in the CIRP Regulations the period of lockdown imposed by the central government in the wake of COVID-19 outbreak shall not be counted for the purposes of the timeline for any activity that could not be completed due to such lockdown in relation to CIRP.
It appears this relief could act as general moratorium on all the active insolvency processes for the prescribed timelines of 180 / 270 / 330 days in those matters which could not be completed due to such lockdown, subject to the provisions of the IBC, 2016.
It may also be noted that this relief is provided only for corporate insolvency process but not for liquidation processes.
“to obviate such difficulties and to ensure that lawyers/litigants do not have to come physically to file such proceedings in respective Courts/Tribunals across the country including this Court, it is hereby ordered that a period of limitation in all such proceedings, irrespective of the limitation prescribed under the general law or Special Laws whether condonable or not shall stand extended w.e.f. 15th March 2020 till further order/s to be passed by this Court in present proceedings .”
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In exercise of the powers conferred by clause (t) of sub- section (1) of section 196 read with section 240 of the Insolvency and Bankruptcy Code, 2016 (31 of 2016), the Insolvency and Bankruptcy Board of India hereby makes the following regulations further to amend the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, namely:-
- These regulations may be called the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) (Third Amendment) Regulations, 2020.
- They shall come into force on the 29th March, 2020.
In the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016, after regulation 40B, the following regulation shall be inserted, namely: –
- “40C. Special provision relating to time-line. Notwithstanding the time-lines contained in these regulations, but subject to the provisions in the Code, the period of lockdown imposed by the Central Government in the wake of COVID- 19 outbreak shall not be counted for the purposes of the time-line for any activity that could not be completed due to such lockdown, in relation to a corporate insolvency resolution process.”
The Notification shall be published in the Gazette of India as soon as the Government Press accepts the same for publication.