To speed up the resolution process of insolvent companies, the government has proposed a rule-based system for resolution professionals (RPs) to determine the value of claims submitted by various creditors of an insolvent company. Under the Insolvency and Bankruptcy Code (Amendment) Bill, 2025 tabled in the Lok Sabha last month, the RPs will have a “quasi-judicial authority” to ascribe values to the claims made by different creditors of a company that has gone into insolvency.

This is a major shift from the current practice where RPs have been “arbitrarily” doing the claim assessment. There have been instances when RPs would reject the claims made by the creditors or put a “notional” value to the claims. In such cases, the aggrieved parties would approach National Company Law Tribunal

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