Govt proposes eight special courts under NCLT to deal with insolvency cases

The Corporate Affairs Ministry is planning to set up eight special courts under the National Company Law Tribunal (NCLT) to deal with insolvency cases, according to a report by Business Standard.

"These courts will be set up in Mumbai, Delhi, Chennai, Kolkata, and Hyderabad," a senior ministry official was quoted as saying.

Three courts will be established in Mumbai, two in Delhi, and one each in Chennai, Kolkata, and Hyderabad, sources told the paper.

After these courts have been set up, Mumbai will have seven courts under the NCLT, while Delhi will have six. Chennai, Kolkata, and Hyderabad will have three courts each.

Apart from insolvency, the NCLT deals with cases pertaining to company law, mergers and acquisitions.

As many as 9,073 cases were under consideration in the NCLT, as on January 31 this year, 2,511 of which were cases of insolvency.

The number has doubled since then, sources told Business Insider. As many as 6,326 companies had filed cases under the Insolvency and Bankruptcy Code, as at the end of June. Most of these cases went into liquidation.

The government is also looking at establishing e-courts to manage cross border insolvency proceedings, the news daily reported. A committee has been set up to iron out the details of cross-border insolvency provisions. #casansaar (Source - PTI, MoneyControl)