Streamlining Insolvency Law and PMLA Enforcement

The Insolvency and Bankruptcy Board of India and the Enforcement Directorate are collaborating to address issues related to insolvency law and the Prevention of Money Laundering Act. A resolution could be issued soon, while the IBBI works on implementing Supreme Court directions and amending the Insolvency Code.

The Insolvency and Bankruptcy Board of India (IBBI) and the Enforcement Directorate (ED) have found a potential solution to streamline the interaction between the insolvency law and the Prevention of Money Laundering Act (PMLA) in resolving stressed assets.

According to IBBI Chairperson Ravi Mital, a circular outlining the solution is expected within the next couple of months. The issue involves cases under the Insolvency and Bankruptcy Code (IBC), where black money-suspected assets may be attached under the PMLA while the IBC offers a moratorium.

Mital, speaking at the IBBI's ninth annual day, noted that the IBBI is also implementing Supreme Court's directions for the real estate sector and preparing draft regulations for proposed IBC amendments, following a bill's introduction in August in the Lok Sabha.

(With inputs from agencies.)