A case is taken up for resolution under the law only after approval from the National Company Law Tribunal.
The insolvency regime for individual guarantors to corporate debtors will be in force from December 1, according to the government.
The provisions for resolution for individuals under the Insolvency and Bankruptcy Code (IBC) is being implemented in a phased manner.
On Friday, the corporate affairs ministry said the provision pertaining to personal guarantors to corporate debtors would come into force from December 1.
The Code provides for a market-driven and time-bound resolution for stressed assets.
A case is taken up for resolution under the law only after approval from the National Company Law Tribunal (NCLT).
In October, Corporate Affairs Secretary Injeti Srinivas said personal insolvency regime would be fully operational in one year.
“In the first phase, personal guarantor to a corporate debtor is almost under commencement. The next would be the fresh start process, basically giving relief to very small borrowers who are not in a position to repay the debt. That may be in another four to six months. Then proprietorship and partnership and others,” he had said.
Source : Economic Times
