Subhash Chandra effect: IBBI proposes tighter safeguards for personal guarantor insolvency
The Insolvency and Bankruptcy Board of India (IBBI) has proposed tighter safeguards for insolvency proceedings involving personal guarantors, including independent valuation of their assets, scrutiny of transactions that could erode creditors’ recovery and mandatory recording of reasons for approving repayment plans.
The proposals come amid controversy over Essel Group chairman Subhash Chandra’s repayment plan, under which creditors with admitted claims of Rs 22,006.57 crore would receive just Rs 6.25 crore — a 99.97% haircut.
