The Ministry of Corporate Affairs vide its notification dated 22nd December 2020 has further extended the suspension of insolvency proceedings for any COVID-19 related default by a period of three months, effective from 25th December 2020.
The Centre had earlier suspended IBC proceedings for a period of six months with effect from March 25 taking note of the difficulties created by the COVID19 pandemic and the lockdown and it further extended the suspension for another three months until the last week of December under the newly inserted Section 10A of the IBC.
Section 10A of the IBC reads, “Notwithstanding anything contained in Sections 7, 9 and 10, no application for initiation of corporate insolvency resolution process of a corporate debtor shall be filed, for any default arising on or after 25th March 2020, for a period of six months or such further period, not exceeding one year from such date, as may be notified in this behalf. Provided that no application shall ever be filed for initiation of corporate insolvency process of a corporate debtor for the said default occurring during the said period.”
