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Insolvency resolution Framework for IL & FS proposed by the Government cleared by the NCLAT

The National Company Law Appellate Tribunal (NCLAT) approved the resolution framework proposed by the Government on 12th March, 2020 in the final judgement on the insolvency proceedings against Infrastructure Leasing & Financial Services (ILFS). The money invested in IL&FS by the Life Insurance Corporation of India, State Bank of India, Central Bank of India and IL&FS Employees Welfare Trust, amongst others constituted public money, and hence the distribution framework under the Insolvency and Bankruptcy Code, 2016 should not be followed. A time limit of 90 days has been set for the resolution process, the NCLAT said that, “ The Union of India (UOI), the board of directors of IL&FS and the Committee of Creditors (CoCs) which are already constituted, or may be constituted, are directed to conclude the resolution of all entities preferably within 90 days”.

 

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