A Critical Examination Of Digital Insolvency In India: Balancing Data Privacy Imperatives Under The DPDP Act With Creditor Recovery Objectives In The IBC Framework
- IJLLR Journal
- 9 hours ago
- 2 min read
A Critical Examination Of Digital Insolvency In India: Balancing Data Privacy Imperatives Under The DPDP Act With Creditor Recovery Objectives In The IBC Framework – A Comparative Perspective With Foreign Jurisdictions
Tanisha Sikarwar, LLM, Department of Law, PK University, Thanra, Shivpuri, Madhya Pradesh
Bhanu Pratap, LL.M., Department of Law, Prestige Institute of Management and Research, Gwalior, Madhya Pradesh
ABSTRACT
The rise of digital technologies has turned data into an important asset for corporations, and this has given rise to complex issues regarding the insolvency of corporations in India, as the Insolvency and Bankruptcy Code (IBC) stipulates the sale of the assets of the company to maximize the amount that creditors receive, but the Digital Personal Data Protection Act (DPDP Act) emphasizes the importance of the protection of personal data, and the question that arises in this regard is whether the data of the users of the tech company can be sold to pay off the loans.
This research paper critically examines the balance between data privacy and creditor recovery in the context of digital insolvency in India. By conducting a comparative analysis with foreign nations, this paper examines the adequacy of the laws in India with regards to this issue. From the analysis done in this paper, it can be concluded that the laws with regards to digital insolvency in India are inadequate.
It is also argued in this paper that the liquidator cannot sell the data of the users like any other office furniture as the data contains sensitive information regarding the individuals and needs to be protected accordingly. It is also proposed by this paper that the best way to balance the two concepts is by allowing the companies to sell the data but with the condition that the names of the users are removed or the users are allowed to opt out before the sale occurs.
Keywords: Digital Insolvency, Data Privacy, DPDP Act, IBC, Creditor Recovery, Cyber Privacy.
