Accelerating Resolution: Mitigating Delays In The IBC Through Advanced Digital Technologies
- IJLLR Journal
- May 30
- 2 min read
Febin P, LLM, National Law Institute University, Bhopal
Aswin P.S, LLM, National Law Institute University, Bhopal
ABSTRACT
The enactment of the Insolvency and Bankruptcy Code (IBC), 2016 marked a paradigm shift in India's corporate credit ecosystem, transitioning the framework from a fragmented, debtor-in-possession regime to a unified, creditor in possession model. However, the efficacy of the IBC's strict 330- day resolution timeline is frequently hindered by severe information asymmetry, error-prone manual diagnostic methods, and procedural resource wastage. This project comprehensively investigates the transformative role of advanced digital technologies in mitigating these systemic bottlenecks and securing optimal firm outcomes.
First, the research explores how Information Utilities (IUs), such as the National E-Governance Services Ltd. (NeSL), institutionalize a One Data, One Entry framework. By acting as centralized, authenticated digital ledgers, IUs rapidly verify claims and mathematically eliminate the informational asymmetry that historically caused protracted evidentiary litigation.
Second, the study evaluates the shift from traditional manual insolvency assessments to the diagnostic precision of Artificial Intelligence (AI) and Machine Learning (ML). AI-powered predictive analytics enable the proactive identification of corporate insolvency risks long before statutory default occurs. Concurrently, advanced digital forensic tools and Natural Language Processing (NLP) algorithms fundamentally upgrade the Corporate Insolvency Resolution Process (CIRP) by automating exhaustive legal due diligence and instantaneously tracing fraudulent or avoidable asset diversions.
Third, the project highlights how procedural streamlining achieved through the digital consolidation of Resolution Professional reporting forms, global digital public announcements, and tamper-proof e-auction platforms drastically minimizes administrative fatigue and maximizes the liquidation value of distressed assets.
Ultimately, the study concludes that piecemeal digitalization is insufficient. To fully realize the IBC's core mandates, the project recommends the deployment of a unified, comprehensive IT platform, the implementation of a mandatory national Resolvability Index, automated post-resolution clean slate clearances through ROC integration, and mandatory technological capacity building for Insolvency Professionals.
