IBC Resolution Time at NCLT Rises to 716 Days in 2023-24: Govt

New Delhi, Aug 6 (PTI) The average time taken for an insolvency resolution process at the National Company Law Tribunal (NCLT) was 716 days in the last fiscal, higher than 654 days recorded in 2022-23, according to official data.

The data provided by the corporate affairs ministry to Rajya Sabha on Tuesday showed that in 2021-22, the average time taken for a resolution was 557 while the percentage of realisable amount compared to admitted claims stood at 23 per cent during the same period.

As per the Insolvency and Bankruptcy Code (IBC), the stipulated resolution time for a case is 330 days, including litigations.

In 2023-24, the average time taken for a resolution was 716 days with the percentage of realisable amount to admitted claims at 27 per cent, as per the data provided by Minister of State for Corporate Affairs Harsh Malhotra in a written reply.

It also showed that in 2022-23, the average time taken was 654 days and the percentage of realisable amount compared to admitted claims was at 36 per cent.

The government has amended the IBC, which came into force in 2016, six times.

"During financial year 2023-24, a total of 12 amendments to various regulations and model bye laws were carried out, thereby effectuating about 86 changes in the regulatory framework to further strengthen the insolvency resolution process," the minister said.

According to data from the Insolvency and Bankruptcy Board of India (IBBI), the number of ongoing corporate insolvency resolution processes stood at 1,973 as of June 30, 2024.

"Out of these, 1,249 cases have exceeded 330 days. The 330-day timeline is exclusive of extensions granted by the National Company Law Tribunal (NCLT) and time spent in legal proceedings related to the resolution process.

"Increase in resolution time is attributable to associated litigation on account of increased number of interlocutory applications," the minister said in another written reply.

In a separate written reply, Malhotra said 19,770 cases were pending before NCLT as on June 30. 2024.

Out of the total, 10,125 cases were pending for more than a year.

At the end of June 30 this year, as many as 3,019 cases were pending before the National Company Law Appellate Tribunal (NCLAT) and out of them, 1,356 cases were pending for over a year.