Balancing Creditors’ and Debtors’ Rights under Insolvency and Bankruptcy Code: A Critical Study
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Date
2025-06
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National Law University and Judicial Academy, Assam
Abstract
The Insolvency and Bankruptcy Code, 2016 (IBC) was enacted to consolidate and reengineer India's haphazard insolvency system to set in motion a time-bound resolution of
distressed assets with the idea that maximum recovery will accrue to creditors. The Code's operational framework also reveals a structural imbalance, favoring financial creditors through the Committee of Creditors (CoC), with operational creditors and corporate debtors and limited stakeholder involvement, and it fails to extend adequate safeguards to the aforementioned groups. This imbalance is exacerbated in sector-specific
issues, viz., Micro, Small, and Medium Enterprises (MSMEs) and the real estate industry, the unique economic roles and vulnerabilities of the parties are disregarded for a more
generic and interchangeable approach in solving these unique problems through a uniform resolution framework. While lawmakers have taken steps to remedy these issues for parties, to recognize homebuyers as financial creditors, and provide pre-packaged insolvency schemes for MSMEs; these parties and other corporate debtors have criticized the IBC's operational framework as still unfairly treating creditors and debtors, provided
procedural rigidity, and unduly liquidating sustainable enterprises
Description
Dissertation submitted to National Law University and Judicial Academy, Assam
in partial fulfilment for award of the degree of
MASTER OF LAWS
Submitted by
Shivani Mishra
SF0224030
LL.M. (2024-2025) III Semester
Supervised by
Mr. Ankur Madhia
Assistant Professor of Law