Not backing big firms on IBC: Goyal

The Centre on Tuesday outrightly rejected the Opposition’s allegation that it has come out with an ordinance to amend the Insolvency and Bankruptcy Code ( IBC) to favour a big corporate house.

Replying to a debate on the Insolvency and Bankruptcy Code ( Second Amendment) Bill 2018, finance minister Piyush Goyal said the govermment brou ght the ordinance to ensure speedy resolution of stressed assets and for the benefit of homebuyers and the MSME sector.

The bill was later approved by the Lok Sabha through a voice vote, after the Opposition walked out in protest alleging that the minister had not given a proper reply to the issues raised by them.

They were also demanding that the bill be referred to the Parliamentary standing committee.

Leader of the Congress Mallikarjun Kharge and several others alleged that the ordinace was brought to facilitate the acquisition of Alok Industries by Reliance Industries.

“People want the government to respond immediately and that is what is appreciated,” he said, adding: “We want resolution and not liquidation” of ailing companies.

Mr Goyal said all provisions of the bill were prospective and not retrospective to benefit any company and it was the NCLT, which in its wisdom, had decided to refer back the issue of acquisition to the Committee of Creditors ( CoC). The minister said that he was not competent to discuss the conduct of the NCLT.

The amendments propose to reduce the minimum voting threshold for the CoC to 66 per cent, from the existing 75 per cent for key decisions— a provision which the opposition said was aimed at benefiting one corporate house.

The bill also aims at giving relief to homebuyers by recognising their status as financial creditors, thus giving them due representation in the CoC.