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Competing Claims: Addressing Exclusive Security Rights And Inter Se Arrangements

Competing Claims: Addressing Exclusive Security Rights And Inter Se Arrangements Among Multiple Creditors Under IBC




Abhimanyu Singal, National Law University, Delhi

ABSTRACT

Insolvency and Bankruptcy Code, 2016 has revolutionised the insolvency paradigm in India. It provides a bundle of rights to the creditor It categorises the financial creditors as secured and unsecured creditors. However, it does not create any further distinction between the secured creditors on the basis of their order of charge on the asset. It has resulted in several complexities during the liquidation process. In this paper, the author has discussed the issue of competing securities in great detail. The paper provides an in-depth analysis of treatment of secured creditors with competing securities at the stage of Section 52 and 53 of the Code. The paper also deals with the question of validity of inter se arrangements among the creditors, and how they affect the creditors in cases of liquidation. The author critically analyses the relevant judgements of the Supreme Court, NCLT and NCLAT and attempts to delineate the approach of the judicial authorities on this issue.

Keywords: Security interest, secured creditor, inter se arrangement, liquidation.

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Indian Journal of Law and Legal Research

Abbreviation: IJLLR

ISSN: 2582-8878

Website: www.ijllr.com

Accessibility: Open Access

License: Creative Commons 4.0

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​All research articles published in The Indian Journal of Law and Legal Research are fully open access. i.e. immediately freely available to read, download and share. Articles are published under the terms of a Creative Commons license which permits use, distribution and reproduction in any medium, provided the original work is properly cited.

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The opinions expressed in this publication are those of the authors. They do not purport to reflect the opinions or views of the IJLLR or its members. The designations employed in this publication and the presentation of material therein do not imply the expression of any opinion whatsoever on the part of the IJLLR.

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