Behaviour Of Creditors And Involved Stakeholders In Corporate Insolvency Resolution Process (CIRP) In India: An Economic Perspective

Abstract

IBC has long clarified its purpose of achieving efficiency in the resolution procedure along with the welfare of the stakeholders. In order to achieve it, the code introduced Corporate Insolvency Resolution Process (CIRP) as a group solution mechanism in insolvency cases. While there is a plethora of studies focusing on the procedural and substantive working of the process, its influence over the behaviour and conduct of the stakeholders and its impact on its success has been ignored. Through this study, the author aims to develop a comprehensive economic model to explain the impact of CIRP on the creditor’s behaviour and the consequential conduct which can be seen in the practical world. The model will utilize various economic tools and theories in order to answer the complex phenomena during the conducting of the CIRP process. Moreover, the suggestions given in the article can help mitigate the inefficient outcomes due to the existing laws and behaviour of creditors.