SBI initiated proceedings against Veesons under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), demanding an outstanding amount of approximately INR 61 crores as Veesons did not pay its debts on time.
PPIRP (Pre-packaged Insolvency Resolution Process) is an alternate for normal Insolvency Process. It has been announced for MSME Sector.
It is advisable to the creditors to make a plea of initiating Group Insolvency while filing an application for initiation of CIRP against a corporate debtor.
The rationale of the Ordinance is certainly to ensure that Insolvency and Bankruptcy Code, 2016 lives up to its preamble that is – maximization of value of assets. The newly inserted Section 10A certainly brings about a balance of interest between creditors and debtors.