More than 1 lakh companies voluntarily exited beneath the businesses legislation in virtually 5 years, the federal government informed the Lok Sabha on Monday.
Besides, many firms have sought voluntary liquidation beneath the Insolvency and Bankruptcy Code, 2016 (IBC).
“From FY 2018-19 to FY 2023-24 (up to 30 November, 2023) 1,06,561 companies exited voluntarily under section 248(2) of the Companies Act, 2013.”
“From FY 2018-19 to FY 2023-24 (up to 30 September 2023) final reports of 1,168 companies have been submitted by liquidators under section 59 of the IBC, of which final dissolution orders have been passed by NCLT (National Company Law Tribunal) in 633 cases,” Minister of State, Corporate Affairs, Rao Inderjit Singh stated in a written reply.
Section 248(2) of the Companies Act pertains to voluntary exit of firms whereas Section 59 of the IBC pertains to voluntary liquidation.
In the final 5 years, Singh stated the time taken for voluntary exit beneath Section 248(2) of the Companies Act has assorted between 6-8 months to even 12-18 months in some instances.
Under the IBC, common time taken for dissolution after submission of ultimate report by the liquidator has ranged between 7-9 months. The time taken by liquidator to submit closing report for adjudication to NCLT has been 14 months.
Earlier this yr, the federal government arrange the Centre for Processing Accelerated Corporate Exit (CPACE) to centralise and expedite voluntarily exit of firms beneath Section 248(2) of the Companies Act, 2013.
“Under CPACE the time taken for voluntary exit during the current year is around 110 days. 470 cases are currently pending for voluntary liquidation under section 59 of the IBC till September 2023. Further, 3,695 cases are pending for voluntary corporate exit under section 248(2) of the Companies Act, 2013 with CPACE,” Singh stated.
Source: www.thehindu.com
