The National Company Law Tribunal on 12.05.2020 passed an order directing to file default record from Information utility along with new petitions under Section 7 of the Insolvency and Bankruptcy Code, 2016.
As per the order, no new petitions shall be entertained without record of default under Section 7 of the Insolvency and Bankruptcy Code, 2016.
Insolvency and Bankruptcy Code, 2016 is enacted to consolidate and amend laws pertaining to insolvency and resolution. Part II of the Code deals with the Insolvency Resolution and Liquidation for ‘Corporate persons’. Under this part of the code; financial creditors, operational creditors and corporate debtors can initiate corporate insolvency process.
Section 7 grants power to financial creditors to file an application against corporate debtor. The Section is largely related to the Initiation of corporate insolvency resolution process by financial creditors.
The National Company Law Tribunal in the same order directed Authorized Representatives/Parties in the cases pending for admission under Section 7 of the Insolvency and Bankruptcy Code, 2016 to file default record from Information Utility before the next date of hearing.