Page 524 - ES 2020-21_Volume-1-2 [28-01-21]

Monetary Management and Financial Intermediation 151

INSOLVENCY AND BANKRUPTCY CODE
4.57. Since the inception of the Code in December 2016, 4,117 applications have been admitted
as on December 31, 2020 (Figure 19). Nearly 23 per cent of the cases admitted were settled or
withdrawn after the commencement of Corporate Insolvency Resolution Process (CIRP). Out of
the 1420 cases for which the CIRP process has been completed, liquidation as an outcome has
happened nearly 3.6 times the resolution. However, this does not represent an accurate picture
of the performance of the Code. This is because 73 per cent (799 cases) of cases undergoing
liquidation and 33 per cent of cases (101 cases) undergoing resolution had been brought in from
earlier Board for Industrial and Financial Reconstruction (BIFR) regime. Most of these cases
have been considered to be dead corpus with most of the net worth being eroded by the time
they entered CIRP. Having been able to revive 101 of such cases is an achievement in itself. The
CIRP for non-BIFR legacy has yielded 195 resolutions and 288 liquidations till date. This also
means that the resolution rate for non-BIFR legacy cases is more than three times higher at 40
per cent when compared to BIFR cases (Figure 20).

Figure 19: Status of CIRPs since its inception (as on December 30, 2020)

Source: IBBI
Figure 20: CIRP outcomes based on BIFR and non-BIFR classification

Source: IBBI
4.58 The ongoing CIRPs at the end of March 2020 were 1966 (Figure 21). In view of COVID-19
pandemic, the Insolvency and Bankruptcy (Amendment) Ordinance, 2020 was promulgated on
June 5, 2020 which suspended initiation of the CIRP of a corporate debtor (CD) under section 7,