The Ministry of Corporate Affairs issued a notification for extension of suspension of insolvency proceedings by another three months with effect from December 25 till March 25, 2021.In the last notification the suspension period was set to end on December 25.
In June, the Centre had suspended IBC proceedings for a period of six months with effect from March 25 taking note of the difficulties created by the COVID19 pandemic and the lockdown. In September, the suspension period was extended for three months up to December 25
An ordinance was promulgated to incorporate Section 10A to the Insolvency and Bankruptcy Code to effectively suspend the operation of Sections 7, 9 & 10 of IBC with respect to default arising on or after March 25 for a period of 6 months, extendable up to maximum of one year from such date as may be notified.
The Ordinance was replaced by the Insolvency and Bankruptcy (Second Amendment) Act 2020 passed by the Parliament in September 2020.
The notification issued by the Ministry of Corporate Affairs on Tuesday states that the Central Government notifies further period of three months from December 25, 2020 for the purpose of Section 10A.
While issuing the Ordinance in June, the Centre said that it was considered expedient to suspend Sections 7, 9 and 10 of IBC to prevent corporate persons experiencing distress on account on unprecedented situation being pushed into insolvency for some time.
Read the notification here:
