Open Access Research Article
EVALUATING THE EFFECTIVENESS OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016: A CRITICAL STUDY WITH SPECIAL REFERENCE TO ODISHA
Abstract
The Insolvency and
Bankruptcy Code, 2016 (IBC) replaced a fragmented, debtor-friendly and
court-centric regime with a time-bound, creditor-in-control process for the
resolution of corporate distress. A decade after its enactment, and following
the most extensive revision of the Code through the Insolvency and Bankruptcy
Code (Amendment) Act, 2026, this paper evaluates whether the Code has delivered
on its three statutory promises: timely resolution, maximisation of asset
value, and the preference for rescue over liquidation. Adopting a
doctrinal-cum-empirical method, the study analyses the statutory scheme,
leading decisions of the Supreme Court, the National Company Law Appellate
Tribunal, the Orissa High Court and the Cuttack Bench of the National Company Law
Tribunal, together with Insolvency and Bankruptcy Board of India data up to 30
June 2026. It then applies the same criteria to Odisha, a mineral- and
steel-intensive State whose large insolvencies (Bhushan Steel, Bhushan Power
and Steel, Odisha Slurry Pipeline, OCL Iron and Steel) shaped national
jurisprudence.
The findings are mixed. Of
9,166 corporate insolvency resolution processes admitted nationally, 4,227
debtors were rescued, and creditors realised 30.52 per cent of admitted claims
but 166.58 per cent of liquidation value. Yet resolution takes an average of
633 days against a 330-day outer limit, and liquidations still outnumber
approved plans by roughly two to one. In Odisha, large steel resolutions
recovered well above the national average, but the single-court Cuttack Bench,
recurring post-resolution demands by State authorities, mining-lease and
licence risks, and a thin local professional ecosystem dilute outcomes. The
2026 amendments, particularly mandatory admission, the exclusion of statutory
charges from “security interest” and licence protection after plan approval,
address several of these constraints, though key reforms remain un-notified.
The paper concludes with calibrated recommendations for the Union, the IBBI and
the Government of Odisha.
Keywords: Insolvency and Bankruptcy
Code, 2016; Corporate Insolvency Resolution Process; IBC (Amendment) Act, 2026;
NCLT Cuttack; Odisha; Committee of Creditors; clean slate; State dues;
resolution plans; liquidation
Published Paper
Author Details
Authors: BIGHNESH MAHAPATRARegistration ID: 1013596 | Published Paper ID: IJLRA13596Approved ISSN: 2582-6433 | Country: Delhi, India
Article Information
EVALUATING THE EFFECTIVENESS OF THE INSOLVENCY AND BANKRUPTCY CODE, 2016: A CRITICAL STUDY WITH SPECIAL REFERENCE TO ODISHA
Authors: BIGHNESH MAHAPATRA
- Journal IJLRA
- ISSN 2582-6433
- Volume 3
- Issue 8
About Journal
International Journal for Legal Research and Analysis
- AbbreviationIJLRA
- ISSN2582-6433
- AccessOpen Access
- LicenseCC 4.0
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