New Delhi: The Lok Sabha committee that reviewed the Insolvency and Bankruptcy (Amendment) Bill, 2025 will table its report in the lower house of parliament on Wednesday, bringing the bill’s overhaul a step closer to reality, two people familiar with the development said.
Once the report is tabled, the Ministry of Corporate Affairs will examine its recommendations and amend the original bill if necessary before pushing for its passage in the Lok Sabha.
A select committee headed by Member of Parliament (MP) Baijayant Panda for the Bhartiya Janata Party (BJP) met on Wednesday to adopt a draft report on the bill, said the first of the two people cited above, both of whom spoke on condition of anonymity.
Discussion and approval of the amendment, after the report has been submitted to the select committee, is scheduled for the ongoing winter session of Parliament, which will last until the end of the week. However, it remains to be seen whether the government will get enough time to work through the bill and push for its passage in the current session. It is possible that the bill will be discussed in the budget session.
The amendments to the IBC are aimed at making the distressed asset market more attractive to investors and to reduce delays in the turnaround of businesses is one of the main reforms currently underway.
Bankruptcy rule-maker and regulator the Insolvency and Bankruptcy Board of India (IBBI) has already sought to make debt resolution more transparent, faster and flexible to the extent its regulations would allow. Fundamental structural changes, however, can only be implemented through legislative changes.
The bill proposes faster admissions to court, a new mostly creditor-led, mostly out-of-court bankruptcy resolution regime for rapid company turnaround, a new multi-company bankruptcy resolution regime and a cross-border bankruptcy resolution regime. This bill represents one of the biggest overhauls of the IBC, which was first introduced in 2016.
“The tabling of the Select Committee Report on the IBC Amendment Act is expected to bring a renewed focus on addressing structural deficiencies in IBCs, particularly delays in resolution, resolution of complex group insolvencies and greater clarity on process timelines,” said Amit Maheshwari, tax partner, AKM Global, a tax and advisory firm.
“If adopted in their current form, the proposed reforms could boost creditor confidence and improve resolution outcomes while preserving the legal balance that has evolved through judicial interpretation of the IBC,” Maheshwari said.
The second person above said it was expected that the select committee’s recommendations would favor these proposals.
Emailed queries to the committee and the Ministry of Corporate Affairs went unanswered.
Another parliamentary panel – the Standing Committee on Finance, headed by BJP MP Bhartruhari Mahtab, said in a report tabled in the Lok Sabha on December 2 that immediate and targeted steps are needed to increase the effectiveness of the IBC as systemic problems such as delays due to shortage of judges, uncertainty over the finality of resolution plans and lack of accountability among business professionals have crippled its potential.
This committee also said that while the IBC has boosted creditor confidence and encouraged domestic and foreign investment, its potential continues to be limited by lingering systemic issues, Mint reported on December 2.
