Most Rajya Sabha Opposition members back amendments in Insolvency and Bankruptcy Code

A majority of Rajya Sabha Opposition members Saturday supported a Bill granting interim relief to businesses from insolvency proceedings, even as some expressed fears over its possible misuse, and urged the government to also help the poor during the crisis.

The Upper House passed by a voice vote the Insolvency and Bankruptcy Code (Second Amendment) Bill, 2020, whereby fresh insolvency proceedings will not be initiated for at least six months, starting from March 25, against companies in view of the coronavirus pandemic.

Also read: Rajya Sabha passes amendment in Insolvency and Bankruptcy Code

Most Opposition members supported the bill, expressing hope that it would help achieve an early revival of the economy.

Praful Patel (NCP) said there is nothing in the Bill to object to, but called for relief in the form of interest subvention for tourism, transport and airline sectors as they were reeling under financial stress.

"We need to go in for major amendments in the Bill,” he said. “There is going to be a serious problem even in the post-moratorium period. We may have to think 'out of the box' to help businesses, the way things are.”

Patel also called for more NCLT (National Company Law Tribunal) benches and said resolution professionals are not yet fully equipped to handle the businesses and there is corruption too.

"Going by the business environment, there is a need for a lot of hand-holding. You need to do something more as the country will progress if its economy does well. I urge you to look at some important aspects to support businesses wherever there are problems," he said.

Manoj Kumar Jha (RJD) urged Finance Minister Nirmala Sitharaman to look at the wisdom across the aisle and accept suggestions given by the Opposition.

Shiv Sena’s Anil Desai said unscrupulous or dishonest corporates should not take advantage of the pandemic situation and siphon off funds that have been made available to them by banks during the pandemic.

K K Ragesh (CPI-M) said that banking has become a bonanza for “friendly” companies and expressed apprehensions this Bill "will push the banking sector into a deep crisis".

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He said huge concessions have been granted to corporates and more than Rs 3 lakh crore have already been written off through book adjustments which were earlier lying as Non-Performing Assets (NPA) with banks.

"Why are huge haircuts being provided to big corporates? Banks are only able to realise less than 50 per cent of advances in many cases," he alleged.

Ram Chandra Prasad Singh of the JD(U) supported the Bill, saying it is progressive and will help revive the economy.

"I am confident that it will help businesses and help India achieve the target of a $5-trillion economy," he said.

Narain Dass Gupta (AAP) alleged discrimination among big and small borrowers in providing relief during the pandemic, saying while major ones are being given moratorium on interests for one year, the smaller ones are not.

Veer Singh (BSP) asked whether a personal guarantor should be held accountable in case of a default on a loan.

Binoy Viswam (CPI) said the Finance Minister should not “blame God” for the pandemic situation as it is the "greed of the man" which is making them eat into the economy.

"This Bill is not touching the real problems. The IBA has come out with a list of wilful defaulters and the government should help get that people's money back,” he said.

“This is people's money. Please help get that amount back," he said, calling for giving money to the poor in these difficult times that will also help revive the economy.