NCLT President Anupinder Singh Grewal suggested raising the insolvency threshold from ₹1 crore to ₹5 crore or ₹10 crore on Thursday. He said, "I do feel that the threshold needs to be revised upwards." He also pushed for mediation to resolve disputes early and warned against professionals who breach integrity.
The National Company Law Tribunal (NCLT) President, Anupinder Singh Grewal has called for a rethink of the threshold for initiating insolvency proceedings, suggesting that the existing ₹1 crore limit could be raised to ₹5 crore or even ₹10 crore. He also pushed for mediation to resolve disputes before they enter the corporate insolvency resolution process (CIRP).
At an Insolvency and Bankruptcy Board of India (IBBI) event on Thursday, Grewal said a large number of cases involving claims of Rs 1-2 crore appeared to be driven more by recovery objectives than genuine insolvency resolution.
"I do feel that the threshold needs to be revised upwards, perhaps to ₹5 crore or even ₹10 crore," he said.
Grewal also highlighted the need to introduce mediation at the pre-CIRP stage. He said NCLT had already started using mediation in appropriate cases and had settled 25 cases before they reached the insolvency process. "We need to incorporate mediation in insolvency. This is very important so that a lot of these cases could be resolved at the pre-CIRP stage," he said. Such an approach could prevent financially distressed companies from entering CIRP when disputes can instead be resolved without triggering the wider consequences of insolvency.
The NCLT president also flagged the real estate sector and homebuyers as another area requiring greater attention. He also said there had been demands for specialised benches for real-estate matters.
Grewal said the tribunal had made significant progress in clearing resolution plan pendency despite staff constraints. Against around 383 plans awaiting approval when he took charge in May, NCLT approved 78 resolution plans worth ₹5,500 crore in the April-June quarter. In July-September, it approved 106 plans worth more than ₹10,000 crore, which he described as an all-time quarterly high. Pendency had subsequently fallen to around 335 plans.
Grewal also called for stronger action against insolvency professionals (IPs) who breach professional discipline or integrity, including those who facilitate backdoor entry by promoters. He suggested that such cases should be referred to the professionals' other regulatory bodies as well, so they could face consequences across their other professional roles and not merely be barred from working as insolvency professionals.
At the event, the minister of state for corporate affairs Harsh Malhotra said the IBC had delivered significant results. "Our guiding principle should be to preserve resolution, revival, value maximisation, viable business, capital, employment and supply chain," the minister said.