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Mediation for faster resolution

The inability of the IBC to dispose of a majority of the cases within the stipulated time is bothering the government and the regulator.

Mediation for faster resolution

The inability of the Insolvency and Bankruptcy Code (IBC) to dispose of a majority of the cases within the stipulated time is bothering the government and the regulator. While cases are to be resolved within 270 days, some have been dragging on for over one-and-a-half years without closure. As of December 2018, out of around 900 ongoing cases, 275 had crossed the 270-day time limit.

Concerned with the delay, the government and the regulators have been thinking of new ways to address the issue. One is to have pre-pack resolution plans. The government is apparently planning to allow a mediation mechanism to reduce the time taken to resolve disputes.

A mediator, as is the practice in some countries, might help expedite the process as the adjudicators - National Company Law Tribunal and National Company Law Appellate Tribunal - and resolution professionals may not always be in a position to bring all the claimants to agree on a resolution.

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