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NCLT President Proposes Raising Insolvency Threshold to Rs 5-10 Crore, Advocates Mediation
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Moneycontrol•01-10-2026, 19:33
NCLT President Proposes Raising Insolvency Threshold to Rs 5-10 Crore, Advocates Mediation
- •NCLT President Anupinder Singh Grewal proposed increasing the insolvency threshold from Rs 1 crore to Rs 5-10 crore to reduce case pendency and focus on genuine insolvency resolution over mere recovery.
- •Grewal highlighted that many cases currently filed just above the Rs 1 crore threshold are primarily for recovery, not insolvency resolution, suggesting an upward revision is necessary after six years.
- •He advocated for incorporating mediation into the insolvency framework, particularly at the pre-CIRP stage, to resolve disputes before they escalate and impact stakeholders like homebuyers and workers.
- •The NCLT President also called for strict action against insolvency professionals who breach disciplinary or integrity requirements, while ensuring bona fide errors do not lead to harassment.
- •Serious disciplinary cases involving insolvency professionals should be referred to other regulatory bodies to ensure broader accountability and deter misconduct.
Key Questions Answered
NCLT President Anupinder Singh Grewal proposed raising the threshold for initiating insolvency proceedings from Rs 1 crore to Rs 5 crore or Rs 10 crore to prevent filings meant primarily for debt recovery rather than resolution.
To reduce pendency and lower distress for workers, homebuyers, and businesses, Grewal suggested incorporating mediation into the insolvency framework at the pre-CIRP stage.
According to the Ministry of Corporate Affairs, a total of 8,987 cases had been admitted till March 2026, with 7,102 reaching closure, out of which about 58% or 4,099 companies were successfully rescued.
