A worker manufactures a lock at a workshop in Aligarh, Uttar Pradesh, India. (Photographer: Udit Kulshrestha/Bloomberg)

Dangerous To Let Viable Companies Close Down, Says IBBI Chief MS Sahoo

Committees of Creditors should provide all relevant information and share their vision for companies under the insolvency process, a senior official said on Saturday as he asserted that it will be dangerous to let viable firms to close down.

Amid rising number of stressed assets being referred for resolution under the Insolvency and Bankruptcy Code, Insolvency and Bankruptcy Board of India Chief MS Sahoo said the law also gives opportunities to rectify the mistakes during the insolvency process.

The objective of the law is to rescue viable companies and close down unviable ones, he said.

“If due to incompetence (of market participants) the reverse happens, then it is dangerous,” Sahoo said.

The Insolvency and Bankruptcy Board of India Chairperson also noted that CoCs must provide all relevant information to resolution applicants so that they find interest in the companies.

He was speaking on the sidelines of a conference organised by industry body Assocham.

The IBC provides for market-driven and time-bound resolution of stressed assets.

Also read: How Jaypee Infratech’s Promoter Manoj Gaur Is Trying To Derail Insolvency Proceedings