The operational creditors (OCs) would be provided the option to pursue voluntary mediation before initiating insolvency proceedings.
It is proposed that the Operational creditor can exercise the option of mediation before filing insolvency applications under Section 9 of the IBC. The operational creditor can undergo mediation with the aid of mediator, as provided under the Mediation Act, 2023.
In the event of failure of mediation settlement, the mediator will prepare a non-settlement report which shall be annexed with the application for initiation of CIRP before the Adjudicating Authority [AA]. The proposal aims to reduce the burden on the AA and thereby expediting admissions.
Comments are invited on the paper and suggestions can be electronically submitted by 24th November 2024.
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