Bills and Acts Current Affairs

Lok Sabha passes Insolvency and Bankruptcy Code, 2015

The Lok Sabha has unanimously passed Insolvency and Bankruptcy Code, 2015 by a voice vote.

The code seeks to ensure time-bound settlement of insolvency, faster turnaround of businesses and create a unified data base of serial defaulters.

Highlights of the Code

  • The Code creates time-bound processes for resolution of the insolvency of companies and individuals.
  • These processes will be completed within time-bound 180 days. If insolvency is resolved in stipulated time, the assets of the borrowers may be sold to repay creditors.
  • The resolution of the insolvency of processes will be conducted by licensed insolvency professionals (IPs). These IPs will be members of insolvency professional agencies (IPAs).
  • IPAs under insolvency resolution will also furnish performance bonds equal to the assets of a company.
  • The Code facilitates establishment of Information utilities (IUs) to collect, collate and disseminate financial information to facilitate insolvency resolution.
  • The insolvency resolution for companies will be adjudicated by the National Company Law Tribunal (NCLT). The Debt Recovery Tribunal (DRT) will adjudicate insolvency resolution for individuals.
  • The Code also gives statutory backing establishment of the Insolvency and Bankruptcy Board of India to regulate functioning of IPs, IPAs and IUs.
For Detailed Analysis: Insolvency and Bankruptcy Code, 2015

Tags:

Lok Sabha passes Compensatory Afforestation Fund Bill, 2015

The Lok Sabha passed the Compensatory Afforestation Fund Bill, 2015 for the establishment of funds under the public accounts of Centre and each State towards compensatory afforestation.

It also provides for additional afforestation and penal compensatory afforestation to regulate collected funds.

Salient features of the bill

  • It seeks to establish the National Compensatory Afforestation Fund under the Public Account of India, and a State Compensatory Afforestation Fund under the Public Account of each state.
  • The payments into the funds include compensatory afforestation, net present value of forest (NPV), and any project specific payments.
  • The National Fund will get 10% of funds collected and the remaining 90% will go to respective State Fund.
  • The collected funds will be utilised for afforestation, regeneration of forest ecosystem, wild life protection and forest related infrastructure development.
  • The bill also seeks to establish National and State Compensatory Afforestation Fund Management and Planning Authorities to manage the funds.
  • The determination of NPV will be delegated to an expert committee constituted by the central government.

Background

  • The Forest (Conservation) Act, 1980 (FCA) governs diversion or use of forest land for non-forest purposes such as industrial or infrastructure projects.
  • A company diverting forest land must provide alternative land for taking up compensatory afforestation.
  • For the afforestation purpose, the company should pay for planting new trees in the alternative land provided to the state. The loss of forest ecosystem must also be compensated by paying for (NPV).
  • In 2002, the Supreme Court of India observed that collected funds for afforestation were underutilised by the states and it ordered for centrally pooling of funds under ad hoc Compensatory Afforestation Fund.
  • The court had set up the ad hoc National Compensatory Afforestation Fund Management and Planning Authority (National CAMPA) to manage the Fund.
  • In 2009, states also had set up State CAMPAs that receive 10% of funds form National CAMPA to use for afforestation and forest conservation.
  • However, in 2013, a CAG report identified that the funds continued to be underutilised.

Tags:

1...1020...2930313233...4050...51