30,600 cases pending in NCLT, disposal possible in 10 years.
Jagran Bureau, New Delhi. The Insolvency Bankruptcy Act (IBC), aimed at speeding up the process of debt recovery by banks, is certainly a major reform step but the huge number of cases pending in the National Company Law Tribunal (NCLT) and delay in decisions is weakening its effectiveness.
The Economic Survey 2025-26 has strongly criticized this, saying that around 30,600 cases are pending in the NCLT by March 2025 and at the current disposal rate, it may take about 10 years to clear them. Such delays lead to 'assets losing value, employees leaving the company, customers turning to competitors and relationships with suppliers breaking down.'
Although the Central Government made a new amendment in the IBC last year to remove its shortcomings, the situation is not yet clear as to how much it will improve the situation. The survey has emphasized on the shortcomings of the existing structure of NCLT.
30,600 cases pending in NCLT, settlement possible in 10 years
It said institutional barriers exist not only in the courts but also at the level of Resolution Professionals (RPs). There are only 30 NCLT benches across the country to handle IBC and Companies Act cases, while out of 4,527 registered RPs, only 2,198 (about 49 per cent) are authorized for active assignment.
RPs are professionals appointed by NCLT who are responsible for winding up the company or selling its stake and assets and settlement of liabilities under the insolvency law. Under the IBC, there is a provision to complete the Corporate Insolvency Resolution Process (CIRP) in 330 days, but on an average it drags on for 713 days.
Average insolvency resolution time 713 days, target 330 days
The average number of cases closed in FY 2025 was 853 days, which is 150 percent more than the statutory limit. This slowness of NCLT is having a deep impact on IBC reforms. This not only hampers economic value but also affects the health of the banking sector as pending cases freeze productive capital. Due to this, the ability of banks to give loans is also affected.
The Pre-packaged Insolvency Resolution Process (PPIRP), launched in 2021 for small enterprises, was touted as a simple, fast and low-cost process, but it has seen only 14 admissions in four years. The survey cited reasons for its low usage such as complexity of the process, lack of awareness about it among people in the MSME sector, inability of small enterprises to get funding, etc.
In view of these challenges, several measures are proposed in the IBC Amendment Bill 2025. It has taken steps to remove procedural delays, such as strict timelines for admission (disposal of applications in 14 days), framework for group insolvency and cross-border insolvency.
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