Bill to amend Insolvency Code introduced in Lok Sabha
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New Delhi: A bill was introduced in the Lok Sabha on Monday seeking to amend the Insolvency and Bankruptcy Code 2016 to clarify if allottees under a real estate project should be treated as financial creditors.
The Insolvency and Bankruptcy Code (Second Amendment) Bill, 2018 was introduced by interim Finance Minister Piyush Goyal and seeks to replace the ordinance brought by the government earlier this year.
The bill provides for inserting an explanation under Section 5 of the bill clarifying that any amount raised from an allottee under a real estate project shall be deemed to be an amount having a commercial effect of borrowing.
It also allows the withdrawal of a resolution application submitted to the National Company Law Appellate Tribunal (NCLAT) under the Code on an application made by the applicant with the approval of 90 per cent of voting shares of the committee of creditors.