Analysis of the Proviso to Section 31(4) of The Insolvency and Bankruptcy Code, 2016

Section 31(4) of the Insolvency and Bankruptcy Code is a provision intended to collaborate the efficiencies of the various corporate and commercial laws when it comes to the resolution of a company. The sub-section was not a part of the original Code and was introduced by the way of an amendment and made effective on 6 June 2018. As per the provision, the Resolution Application is required to obtain the necessary approvals of the other Regulators and adjudicating authorities created under various other applicable laws, after the approval of the Resolution Plan by the Committee of Creditors and the Adjudicating Authority. The proviso to the Section states that in case the RP contains a plan for a ‘combination’, approval of the Competition Commission of India would be required ‘before’ the approval by the CoC. Such a distinction calls for an analysis as to the legislative intent of the proviso and the judicial trends to that effect. Thus, this paper delves into understanding the legislative intent and analyze the judicial trend before reflecting on personal impressions.