This document summarizes amendments to India's Insolvency and Bankruptcy Code (IBC) as of July 28, 2025, in response to Lok Sabha Unstarred Question No. 1299. The IBC has undergone six legislative interventions since its enactment to strengthen the insolvency framework and enhance procedural efficiency. Key amendments include: the First Amendment (2017) introducing Section 29A to prevent individuals with questionable backgrounds from acquiring distressed companies; the Second Amendment (2018) lowering voting thresholds for resolution plan approval and routine decisions, while streamlining Section 29A; the Third Amendment (2019) clarifying restructuring processes; the Fourth Amendment (2019) facilitating the continuation of critical goods and services; the Fifth Amendment (2020) introducing Section 10A suspending insolvency applications due to COVID-19; and the Sixth Amendment (2021) introducing the Pre-packaged Insolvency Resolution Process for MSMEs. As of January 18, 2023, the government released a discussion paper inviting public suggestions to further strengthen the IBC. A final decision on these suggestions is pending. The Prime Minister's Office review and related safeguards are not applicable at this time. The Minister of State in the Ministry of Corporate Affairs, Harsh Malhotra, provided the response.
Key Entities Referenced
Insolvency and Bankruptcy Code: The primary legislation under discussion, aimed at resolving insolvency and bankruptcy issues.
IBC: Abbreviation for Insolvency and Bankruptcy Code.
Prime Ministers Office: The office of the Prime Minister, which reviewed amendments to the Insolvency and Bankruptcy Code.
MINISTRY OF CORPORATE AFFAIRS: The government ministry responsible for corporate affairs and the administration of the Insolvency and Bankruptcy Code.
DR. MALLU RAVI: The member of parliament who posed the question regarding amendments to the Insolvency and Bankruptcy Code.
HARSH MALHOTRA: The Minister of State in the Ministry of Corporate Affairs who provided the answer to the question.
COVID19: The COVID-19 pandemic, which led to the introduction of section 10A suspending insolvency applications.
Prepackaged Insolvency Resolution Process: A resolution process introduced for corporate MSMEs through the Sixth Amendment of the IBC.
GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
LOK SABHA
UNSTARRED QUESTION NO. 1299
ANSWERED ON MONDAY THE 28TH JULY, 2025/ SRAVANA 6, 1947 (SAKA)
AMENDMENTS IN INSOLVENCY AND BANKRUPTCY CODE (IBC)
QUESTION
1299. DR. MALLU RAVI:
Will the Minister of CORPORATE AFFAIRS be pleased to state:
(a) the key amendments recently finalized to the Insolvency and Bankruptcy Code
(IBC) and their expected timeline for notification and implementation;
(b) whether the Prime Minister’s Office reviewed these amendments and if so, the
major concerns or modifications highlighted during the review; and
(c) the safeguards being introduced to ensure the amendments improve insolvency
resolution timelines and reduce backlog in tribunals?
ANSWER
MINISTER OF STATE IN THE MINISTRY OF CORPORATE AFFAIRS AND MINISTER OF
STATE IN THE MINISTRY OF ROAD TRANSPORT AND HIGHWAYS
[HARSH MALHOTRA]
(a): The Insolvency and Bankruptcy Code (Code/IBC) has undergone six legislative
interventions since its enactment aimed at strengthening the insolvency framework
and enhancing procedural efficiency in sync with the evolving market dynamics. The
key amendments to the Code are given below:-
First Amendment (2017): Introduced section 29A to prohibit persons, who do not
have credible antecedents, from submitting resolution plans or taking over
companies in stress.
Second Amendment (2018): Lowered voting threshold to 66% for resolution plan
approval and 51% for routine decisions. Allowed closure of CIRP with 90% approval
of CoC, streamlined section 29A, and provided a one-year grace period for RAs.
Third Amendment (2019): Provided clarifications regarding restructuring through
mergers, amalgamations, and demergers. Addressed voting impasses among
creditors and made resolution plans binding on government entities.
Fourth Amendment (2019): Facilitated continuation of critical goods and services,
introduced section 32A regarding ceasing of liabilities for offenses before CIRP, and
protected property under approved resolution plans.Fifth Amendment (2020): Introduced section 10A suspending insolvency applications
for defaults from March 25, 2020, for period up to one year due to COVID-19.
Sixth Amendment (2021): Introduced Pre-packaged Insolvency Resolution Process
for corporate MSMEs.
The Government has invited suggestions via a discussion paper released on 18th
January, 2023 from public with a view to further strengthen the functioning of the
Insolvency and Bankruptcy Code, 2016. A final decision has not been taken on the
same.
(b) & (c): In view of the answer to part (a), the question does not arise.
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