A Lok Sabha committee that reviewed the Insolvency and Bankruptcy Code (Amendment) Bill, 2025 will table its report in the lower house of parliament on Wednesday, bringing the law’s revamp a step closer to reality, two persons familiar with the development said.
Once the report is tabled, the ministry of corporate affairs will examine its recommendations and modify the original bill where needed before pressing for its passage in the Lok Sabha.
The select committee, led by Bhartiya Janata Party (BJP) member of parliament (MP) Baijayant Panda, met on Wednesday to adopt the draft report on the bill, said the first of the two persons cited earlier, both of whom spoke on the condition of anonymity.
Consideration and passing of the amendment bill after the select committee presents its report has been scheduled for the ongoing winter session of parliament, which will continue till the end of the week. However, it remains to be seen whether the government gets sufficient time to work on the bill and press for its passage in the current session itself. It is possible the bill could be taken up in the budget session for passage.
IBC amendments are aimed at making the distressed-assets market more appealing to investors and to cut delays in corporate turnaround are one of the major reforms currently underway.
Bankruptcy rule maker and regulator Insolvency and Bankruptcy Board of India (IBBI) has already sought to make debt resolution more transparent, quick and flexible to the extent its regulations could allow. However, major structural changes can be implemented only through legislative changes.
The bill proposes faster tribunal admissions, a new creditor-led, mostly out-of-court bankruptcy resolution scheme for quick corporate turnaround, a new scheme for dealing with insolvency of multiple companies in a group in one go, and a cross-border insolvency resolution regime. This bill marks one of the biggest overhauls of the IBC that was first rolled out in 2016.
“The tabling of the select committee’s report on the IBC Amendment Bill is expected to bring renewed focus on addressing structural gaps in IBC, particularly delays in resolution, treatment of complex group insolvencies and greater clarity on procedural timelines,” said Amit Maheshwari, tax partner, AKM Global, a tax and consulting firm.
“If adopted in their current form, the proposed reforms could strengthen creditor confidence and improve resolution outcomes, while preserving the jurisprudential balance that has evolved through judicial interpretation of the IBC,” said Maheshwari.
The second person cited above said that the select committee’s recommendations are expected to favour these proposals.
Queries emailed to the committee and to the ministry of corporate affairs remained unanswered.
Another parliamentary panel—the standing committee on finance led by BJP member of parliament Bhartruhari Mahtab, had on 2 December said in a report tabled in Lok Sabha that immediate and targeted steps were needed to boost the efficiency of IBC, as systemic challenges such as delays due to a shortage of judges, uncertainty around finality of resolution plans and lack of accountability among professionals running bankrupt businesses have hampered its potential.
That committee also said that while IBC has strengthened creditor confidence and encouraged both domestic and foreign investment, its potential remains hampered by persistent systemic challenges, Mint reported on 2 December.
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