Accelerating Insolvency Resolution: Time-Bound Appellate Proceedings under the Insolvency and Bankruptcy Code (Amendment) Act, 2026: A Critical Study of Judicial Enforcement and Procedural Safeguards
Year: 2026
Type: article
Abstract: The Insolvency and Bankruptcy Code, 2016 treats speed as essential, because delay destroys the value that insolvency proceedings are meant to protect. Yet until 2026 the Code set no time limit for the National Company Law Appellate Tribunal (NCLAT) to decide appeals, so approved resolution plans could stay contested for years. The Bhushan Power and Steel litigation, which ran from 2019 to 2025, is the clearest example. The Insolvency and Bankruptcy Code (Amendment) Act, 2026 responds by inserting Section 61(6), which requires the NCLAT to dispose of appeals within three months. This doctrinal study tests that provision against the Supreme Court's decision in Essar Steel, which struck down the mandatory 330-day limit for the resolution process as manifestly arbitrary. It also compares India's approach with appellate practice in the United States, the United Kingdom and Singapore, and uses published pendency data to assess whether the deadline can be met. The study makes four findings: Because Section 61(6) attaches no drastic consequence to a missed deadline, it is likely to survive constitutional challenge. It will probably be read as directory, meaning a decision given after three months remains valid. None of the comparator jurisdictions imposes a similar disposal deadline on its appellate court; each relies instead on structural reform and specialist judges. With about 11,186 appeals pending, two benches and a statutory cap of eleven members, the NCLAT cannot presently meet the timeline across the board. The study therefore recommends that the deadline be supported by greater bench strength, clearance of the backlog, firmer case management, consistent penalties for frivolous appeals and transparent compliance data.
Author: Rishi KTR
Language: English
Subfield: Law
Field: Social Sciences
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7223561121