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The Lok Sabha on Tuesday gave its nod for the Insolvency and Bankruptcy Code (Second Amendment) Bill 2018 that seeks to replace the June 6 ordinance, which provided relief to home buyers and MSME sector.
The Bill got the approval of the Lower House after the principal opposition Congress demand of sending it to the Standing Committee on Finance was rejected.
Interim Finance Minister Piyush Goyal, who moved the Bill for consideration and passage, also rejected the contention of the Opposition parties that the Bill was “tainted” as certain changes were being brought about to favour a large influential corporate house, which was acquiring Alok Industries at about ₹5,000 crore when the debt owed by the ‘debtor company’ in question was as high as ₹30,000 crore.
Congress leader Veerappa Moily, who is also the head of the Standing Committee on Finance, demanded that the Bill should be referred to the Standing Committee on Finance. Moily and BJD leader Bhartruhari Mahtab questioned the motive of the Government in lowering of the voting threshold for various decisions of the committee of creditors to 66 per cent for important decisions and 51 per cent for routine decisions. Prior to this change, the voting threshold for all CoC decisions was pegged at 75 per cent.
They alleged that the June 6 ordinance was mainly issued to enable the lowering of voting threshold, which had made it easier for the resolution plan of Alok Industries to sail through.
Refuting their contention, the Finance Minister said the lowering of the threshold had nothing to do with Alok Industries. The threshold reduction was recommended by the Corporate Affairs Ministry appointed Insolvency Laws Committee, which gave its report in March 26, 2018 itself, Goyal said.
“We (Government) accepted the recommendations of this report in toto. Every clause has been accepted. There are only few which was not accepted and they could be given out in the public domain. There is no point in casting aspersions on the judiciary (which approved the resolution plan), which is not a good sign”, Goyal said in an intervention in the Lower House on Tuesday.
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