Insolvency and Bankruptcy Code (IBC) completes 10 years

The Insolvency and Bankruptcy Code (IBC), 2016 has completed a decade since its implementation, marking a significant milestone in India’s efforts to reform insolvency resolution and improve credit discipline. Over the past ten years, the Code has evolved into a key institutional framework influencing credit markets, corporate governance, investor confidence, and economic efficiency.

According to official data, as of March 2026, 1,419 corporate insolvency cases have successfully yielded resolution plans, resulting in the realization of more than ₹4 lakh crore for creditors. The Code has also contributed to strengthening repayment culture among borrowers and improving creditor confidence.

Background: Insolvency Framework Before IBC

Prior to the enactment of the IBC, insolvency resolution in India was governed by multiple laws and institutions, including:

• The Companies Act
• The Sick Industrial Companies Act (SICA)
• Debt recovery mechanisms
• The SARFAESI Act

The coexistence of various legal frameworks often led to fragmented proceedings, overlapping jurisdictions, delays, and uncertainty in the resolution of distressed assets.

Key Features of the Insolvency and Bankruptcy Code

The IBC established a unified insolvency resolution framework for companies, partnership firms, and individuals by consolidating multiple insolvency laws into a single statute. 

• Shift from a debtor-in-possession model to a creditor-in-control framework.
• Introduction of the Corporate Insolvency Resolution Process (CIRP) as the primary mechanism for corporate insolvency resolution.
• Formation of the Committee of Creditors (CoC), comprising financial creditors, to evaluate and approve resolution plans.
• Establishment of a time-bound insolvency process, initially requiring completion within 180 days, with extensions allowed up to 330 days under specified circumstances.

Institutional Framework

The Code is supported by a dedicated institutional structure:

• Insolvency and Bankruptcy Board of India (IBBI): Regulates insolvency processes, insolvency professionals, and related institutions.
• Insolvency Professionals (IPs): Manage distressed entities, protect assets, and facilitate the resolution process.
• National Company Law Tribunal (NCLT): Adjudicates corporate insolvency matters.
• National Company Law Appellate Tribunal (NCLAT): Hears appeals against NCLT decisions.

Important Amendments

2019 Amendment: Introduced an overall maximum timeline of 330 days for completing insolvency resolution proceedings.

2021 Amendment: Introduced the Pre-Packaged Insolvency Resolution Process (PPIRP) for Micro, Small and Medium Enterprises (MSMEs).

2026 Amendment: The latest amendment seeks to address operational gaps identified during the implementation of the Code:

• Time-bound Admission of Cases: Adjudicating authorities are required to decide insolvency applications within 14 days. Any delay must be accompanied by recorded reasons.
• Enhanced Role of Creditors in Liquidation: Creditors can now supervise liquidation proceedings and replace the liquidator when necessary.

Inclusion of Guarantors’ Assets: Assets of guarantors may be included in the resolution process, subject to creditor approval and prescribed conditions, thereby improving recovery prospects in complex financial arrangements.

Source: PIB