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IBBI modifies liquidation norms to expedite insolvency process

The Insolvency and Bankruptcy Board of India (IBBI) has amended the regulations to expedite the liquidation process by enabling the liquidator of a stressed company to assign or transfer a ‘not readily realisable asset’ to a third person after consultation with the stakeholders’.

The IBBI defined the term ‘not readily realisable asset’ as any asset included in the liquidation estate that could not be sold through the available options including contingent or disputed assets and assets underlying proceedings for preferential, undervalued or extortionate credit and fraudulent transactions.

The transfer of debt to a third party with better financial capacity may lead to improvement in allocation of resources in the economy.


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