COMMERCISAL WISDOM OF CREDITORS FOR VALUE MAXIMIZATION

Abstract

This Article discusses the Indian Insolvency law making a shift from a debtor-in-possession to a creditor-in-control model. It discusses how this model relies on the commercial wisdom of those that would be most affected by it. It discusses the interplay of the creditors and the Adjudicating Authority in the decision making process. The basic assertion the Liquidation value and the Resolution value should either be equal and if not, opt for the value which is higher is not be determined by the adjudicating authorities or any other parties other than the financial creditors of the Corporate Debtor (CD). The analysis of the decision-making process of the Creditors of the CD helps us understand how information and long-term thinking and vision are significant for Creditors when considering the feasibility of a Resolution Plan. The role of Insolvency and Bankruptcy Code (IBC) 2016 in the commercial machinery is to set a fair and effective system to resolve the problem