SC upholds laws protecting new owners of bankrupt companies
By ANI | Published: January 20, 2021 02:56 AM2021-01-20T02:56:20+5:302021-01-20T03:05:07+5:30
The Supreme Court on Tuesday upheld laws that protect new owners of insolvent companies from the charges filed against the previous management.
SC upholds laws protecting new owners of bankrupt companies
The Supreme Court on Tuesday upheld laws that protect new owners of insolvent compes from the charges filed against the previous management.
"A bankrupt company and its assets cannot face criminal proceedings once it is sold to new owners," a bench of the apex court, headed by Justice Rohinton Fali Nariman, said, in its verdict.
The top court upheld the Section 32A of the Insolvency and Bankruptcy Code (IBC) granting statutory immunity to successful resolution applicant from prosecution.
"Imperative needs to attract resolution applicants who would not shy away from offering reasonable and fair value. Legislature thought it is necessary to provide legal immunity to corporate debtor, provision is well thought out," the court noted.
( With inputs from ANI )
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor
Open in app