The Insolvency Law Committee (ILC) was constituted by the government to take stock of the functioning of the IBC 2016 and to make suitable recommendations to ensure its effective implementation. Thereafter, the Committee was re-constituted as a Standing Committee. The Committee has played a pivotal role in ensuring that the insolvency framework under the Code could readily address several implementation based challenges as well as continually be updated in line with changing market realities. The Committee was taken through numerous suggestions and comments provided by stakeholders including issues concerning the admission process and the scope of the moratorium for CIRP; existing and emergent issues concerning avoidance actions and improper trading, as well as those relating to submission of the resolution plan and liquidation of the corporate debtor.  The Committee also considered the suggestions received in the public comments and through the stakeholder consultations conducted by the MCA.

Recommendations of the committee include mandating on information utilities for certain Financial Creditors, exemptions from the scope of the moratorium, issues related to avoidable transactions and improper trading and curbing submission of unsolicited resolution plan and revision of resolution plans among other recommendations. Various recommendations of the committee are compiled in Annexure II of the report.

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