Insolvency and Bankruptcy Code (amendment) bill passed in the Parliament

On March 12, 2020, Insolvency and Bankruptcy (Amendment) bill, 2020 has been passed in the parliament. It was earlier passed by Lok Sabha and is now being passed by Rajya Sabha.

Highlights

The amendments were earlier introduced as ordinances. Now after the Parliament session begun the ordinance was introduced as bill. And the bill has now been passed as an act in the parliament.

The amendment aims to protect the successful bidders of insolvent companies from risk of criminal proceedings. The criminal proceedings may be expected from previous promoters of the company.

Ordinance

The Ordinances are laws promulgated the President of India. The President issues ordinance on recommendation of Council of Ministers. An ordinance shall be issued only when the Parliament is not in session.

Ordinance in Constitution

Article 123 gives powers to the President of India to promulgate ordinance in India. An ordinance should be approved by the Parliament within 6 weeks of its reassemble. If not, the ordinance ceases to operate.

Month: Current Affairs - March, 2020