Thu May 15 16:41:19 UTC 2025: **News Article:**

**IBC Resolutions Surge in FY 2024-25, Recoveries Second Highest on Record**

**CHENNAI, May 15, 2025** – India’s Insolvency and Bankruptcy Code (IBC) continues to demonstrate its effectiveness, with recoveries from resolution plans reaching the second-highest level on record in fiscal year 2024-25. Data from the National Company Law Tribunal (NCLT) reveals that 284 resolution plans were approved, resulting in settlements totaling ₹67,176 crore. This represents a significant 42% increase compared to the ₹47,206 crore recovered through 275 plans in the previous fiscal year.

The ₹67,176 crore recovery is only surpassed by the ₹1,19,993 crore recovered in FY 2018-19 from 81 cases. This positive trend highlights the IBC’s improved functionality in resolving corporate insolvencies since its enactment in 2016.

A total of 1,346 companies were admitted into the corporate insolvency resolution process in 2024-25, a slight increase from the 1,318 admitted the year before.

While the recovered amount is a positive indicator, experts caution that it must be viewed in the context of the total admitted claims, which stood at over ₹11 lakh crore as of December 2024. However, according to Saurabh Bhalerao, associate director at Care Edge Ratings, the higher resolution rate can be attributed to increased capacity at the NCLT and streamlined regulatory processes.

The IBC has achieved a recovery rate of approximately 31% in recent years, with ongoing cases hovering just below the 2,000 mark. The ratio of liquidation to resolution has also improved significantly, decreasing from 5.06 in FY18 to 1.32 in the first nine months of FY25.

Despite the successes, the time required to resolve cases remains a challenge due to ongoing litigation. Efforts are underway to expedite the process and preserve business value, including exploring formal out-of-court solutions like mediation, extending pre-pack resolution mechanisms to larger firms, and addressing insolvencies of group companies. These measures are expected to further enhance the IBC’s effectiveness and improve recovery rates in the future.

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