Proposed Pre-Package Insolvency in India and conundrum of Connected Parties

*Pragyansh Nigam & Rajat Sinha

Abstract

The Ministry of Corporate Affairs in India, on 24 June 2020, constituted a sub-committee under the Chairmanship of Dr. M.S. Sahoo, for recommending a regulatory framework for Pre-package Insolvency in India.[ii]The report was released and made public in the month of January, providing a model framework. Essentially, a pre-packaged insolvency resolution process (“Pre-packs”) is a framework where the resolution proposal is drawn up and finalized before formal proceedings are started. On a basic level, pre-packs provide for a more confidential and speedier resolution and restructuring of business, but it comes at its own costs.

The discussion on the introduction of Pre-Packs was accelerated by the advent of the COVID – 19 pandemic and the national lockdown in India, which led to closure of multiple businesses.While the entire framework of the pre-package resolution process would be quite complex, it would be interesting to see how this framework would treat the ‘connected parties’ or ‘related parties’ in India. This question is important because while India has taken a strict stance on exclude all related parties from even submitting a resolution plan under Section 29A of the IBC,  pre-packs, more often than lead to sale of business to related parties.

In this short article, we attempt to analyse the various suggested frameworks for pre-packs in India and assess whether they adequately address the problem of connected parties. At the end, we propose a possible framework for treating connected parties in the going to be framework for pre-package Insolvency in India. The current article provides a brief understanding of the concept, then assesses the regime with respect to connected persons under Section 29A of the IBC. Post this, the article discusses various approaches proposed for the Indian regime and the issues with the approach. Finally, the authors provide a new model which deals with all the issues pointed out.

Understanding Pre- Package Insolvency

The concept and mechanism of formal Pre-package insolvency is yet to be legislated in India as opposed to the Insolvency regimes of US and UK. In this regard, organisations such as Vidhi Centre for Legal Policy and Indian Institute of Management have suggested their proposed Pre-Pack Models, after taking an inspiration from these regimes.

A pre-pack is fundamentally a pre-determined sale on a going concern basis of the sick business.[iii] The particulars of the sale are pre-arranged prior to the commencement of Insolvency Resolution Process, and the sale is given effect almost immediately with the appointment of Insolvency Resolution Professional. The rationale for the sale is that selling a corporate as a going concern is expected to yieldbetter value for creditors. One of the major difference of it from normal insolvency is the fact that the administration of the corporate debtor has control and management of the company while a resolution plan is being formed. The Adjudicating authority is involved only once the parties finalise the resolution plan. Additionally, a pre-pack sale is concluded quickly and discreetly, which gives rise to a number of procedural concerns.

Assessing India’s Insolvency Regime with respect to connected parties.

1.      The position prior to Section 29A

The IBC, when came into force in 2016, did not impose any restrictions on the connected parties with regards to submitting a resolution plans. It was later added through an amendment by way of Section 29A. It needs to be remembered that it was not that the legislature has mistakenly omitted this provision.[iv] In fact, legislature initially intended for no such provision to be present in the first place. This is evident from the fact that the Bankruptcy Law Reforms Committee Report, 2015 [“BLRC Report”], which essentially contained the design of IBC, encouraged the promoters “make a proposal that involves buying back the company for a certain price, alongside a certain debt restructuring”.[v]

2.      Why Section 29A was introduced?

A connected person is someone who is either an existing or is a potential promoter or exercised some kind of control and management over the corporate debtor. Thereby, a connected party could also be the holding, subsidiary company, associate company or related party of any of the person.[vi] The rationale behind such a restriction is the perception that a connected party has contributed in the default of the company which has eventually led it to the insolvency. Thus, ideally they should be barred from submitted resolution plans.

Section 29A was introduced by way of the Insolvency and Bankruptcy Code (Amendment) Act, 2018.[vii]Section 29A deals with persons who are not eligible to submit be resolution plans, thereby cannot become resolution applicants.[viii]The connected parties post the amendment are prohibited from participating in a compromise or agreement involving the distressed company after a liquidation order is passed under the IBC according to the ‘Liquidation Process Regulations’.[ix] The Amendment Act also provided that the resolution plan must not contain any such terms by way of which, during the tenure of the resolution period, the existing management of the corporate debtor do not return to manage its affairs.[x] The management of the Company during such period should be vested with the companies who are in no way linked to the corporate debtor or the management of the corporate debtor.[xi]

It needs to be seen that the regimes of USA and even UK to a large extent, do not prohibit the promoters or any other connected party from submitting a resolution plan.[xii]However, considering the strict jurisprudence in India as regards the connected parties, it can be safely concluded that in India, the connected parties would be prohibited from submitting resolution plans by way of Section 29A of the IBC.

Should Connected parties be made part of Pre-package Insolvency?

A question arises that should there be any amendment made to the IBC to allow connected parties to be involved in the pre- pack mechanism, there is no definite answer to it. On one hand, it can be argued that since the insolvency of the company was caused by the defaults caused by existing management of the company, allowing such management to retain control of the company directly or indirectly would be inefficient rather counter-productive.[xiii] Therefore, all links which the existing management has with the debtor company should be severed. However, the question becomes pertinent when the default is caused due to external factors. It has been argued that in such cases it would be beneficial if the existing management of the company to retain control.[xiv] If the management or the promoters were not at fault, there is no point of imposing any restrictions on them.[xv]It needs to be seen that global position is particularly supportive of connected party sales for various reasons.

The Graham Committee Report[xvi] in U.K. concluded that the possibility of failing of a pre-pack pack sale to a connected party is higher than that to any other party. However, it still did not prohibit the same or alternatively ban pre-pack insolvency. It allowed sales in cases “when a corporation is experiencing financial difficulties due to an industrial slow down, it is unlikely that other companies in the industry will be willing to purchase the whole business of the corporate debtor. In such cases, the incumbent management is often the only one willing to purchase the business of the company.”[xvii]

There is yet another reason as to why such sales should be allowed. An objective-cum-advantage of pre-pack insolvency is ‘maintaining secrecy’.[xviii] Essentially, when an insolvency process is initiated against a corporate debtor, a public announcement is made, which is not good for the business of the company. The goodwill of the company is affected when it is announced that the company has turned insolvent. If sales are made to the connected parties, it would further the objective of secrecy. Therefore, once pre-packaged insolvency is legalized in India, the sales to connected parties should not be totally prohibited.

Proposed approaches

Several institutions have come up with their own suggestive models. Herein, one comprehensive model was proposed by Vidhi Centre for Legal Policy (“VIDHI”) and the other in a working paper of Indian Institute of Management, Ahmedabad (IIM-A). Before, we could come up with a new model, it is important to assess the suggestions of these organisations.

1.      The VIDHI approach

Vidhi came up with a report, proposing a framework for pre-packaged insolvency resolution in India.[xix] The report proposed a framework which allows the promoters and their connected parties to submit the resolution plans. The report also acknowledged that in certain cases an account of the debtor may be classified as non-performing asset during the pre-pack process. Given this, it should be monitored whether, by permitting promoters and managers to participate in the Pre-package Insolvency Resolution process (“PPIRP”), if there is any abuse of process or unjust enrichment.

The report proposed a procedure to ensure that the concerns surrounding Section 29A could be addressed. The rationale it provides for including these parties is the fear of them losing control over the corporate debtor, they would not only cooperate with the creditors during the PPIRP but also submit a plan which is acceptable to them.

Further, it proposes that when resolution plans are submitted by persons who are related to the corporate debtor, such plans should be subject to additional safeguards. For example, in case of connected party pre-packs, the Committee of Creditors (“CoC”) should be required to file a statement with the Adjudicating Authority outlining the reasons for approving a plan proposed by the existing management or any of its connected parties. Such statement should also highlight the alternatives which were considered by the CoC and explain how the accepted plan provides the maximum value to the creditors as a whole. The report also took the concept of ‘pre-pack pool’ from the UK bankruptcy law,[xx] and instead proposes to make it mandatory in India. For every reference to the body, the resolution applicant should be mandated to pay upfront the fees for the same. As an additional measure, if a corporate debtor slips into financial distress shortly after acceptance of the plan, it may be prohibited from participating in a fresh PPIRP.

Moreover, the insolvency professional should also file the feasibility report before an independent body of experts, if the resolution applicant is a connected party. Further, the CoC has to state reasons for approving the plan if it was put by a connected party.

2.      IIM- Ahmedabad approach

IIM-A formulated a working paper titled “Pre-packs in the Indian Insolvency Regime”,[xxi] to propose a model for pre-package insolvency in India. The working paper also proposed a mechanism for including connected parties to be eligible to submit the resolution plan. However, its approach totally revolved around how Section 29A can be amended and interpreted to include promoters and related parties.

The paper suggests that a resolution professional should be appointed to ensure all dealings happen at a fair price. The control of the company still remains with the management of the company, the resolution professional would simply overlook the entire process and ensure fairness. It states that a pre-pack regime retaining these restrictions would limit the incentives of the secured creditors and the incumbent management from cooperating during pre-pack negotiations. For instance, if the creditors want to negotiate a deal with the parties such as promoters or the directors, and the law restricts them, they would simply go and trigger the Corporate Insolvency Resolution Process (“CIRP”) and take the regular rule. This would refute the very objective of bringing pre-packs into the regime.

While the pre-pack sales to connected parties is likely to affect some pre-pack negotiations in India, scepticism about any connected party participation in the insolvency process will unnecessarily complicate all pre-pack negotiations. Accordingly, the paper proposes that the IBC needs to (cautiously) embrace the participation of the incumbent management and promoters of a company in the insolvency resolution process in order to reap the full benefits of a pre-pack regime.

Issues with the proposed models with respect to connected parties

The models proposed by the two papers sound vague and do not solve various other issues that connected parties may create. There are certain flaws in the proposed suggestions. Following are the issues is the proposed models of pre-pack sales to connected parties –

1.      Less discussion on the aspect of marketing exercise

Marketing exercise is crucial because if it is found that the business does not have enough marketability, it is likely to be sold back to connected parties. In this regard, the ideal way to sell a business is usually to dispose of it at its market value, which can normally be identified through a lengthy and extensive process of advertising the business to the relevant markets.[xxii] The appointed Insolvency professional then ensures marketing with proper procedure takes place and his job to identify the best bidder.[xxiii]

However, unlike regular insolvency, pre-package insolvency is more expeditious in nature.[xxiv] The Insolvency professional does not handle the marketing and negotiations of the sale. It is the management of the corporate debtor who does that. Empirical evidence from the United Kingdom has shown that the pre-pack business sales are marketed to a far less extent than business sales within administrations.[xxv]The fact that a connected party is the one whose resolution plan has been accepted, gives outsiders the impression that minimal efforts had been taken   in marketing, to attract qualified purchasers to come forward.[xxvi] Thus, the quality and accuracy of the marketing records reported can be questionable.

The marketing problem is bound to arise in any regime unless proper steps are taken against it. Marketing was often reported as occurring where in fact it was very limited.[xxvii]For instance, at times the marketing is limited to inquiries made within the IP firm itself with no genuine external marketing occurring. Sometimes, IPs have accepted the word of the directors that there is no ready market for the business outside the management team (or other connected parties).[xxviii]

The major reason behind low marketing is the limited funds available with the corporate debtor. A going concern sale would usually be preceded by a period of trading in order to identify the highest price.[xxix] In practice, however, the process is more complex and influenced by many more complicated variables than in an ideal world, especially when the company is in crisis. It is often the case that there is a failure to attract any fresh funding to support a trading-out in administration.[xxx] In such a situation, an open market sale would seem to be impractical.

The Indian case is more peculiar than the UK. In India, majority of businesses are run by the Medium Small and Micro Enterprises (“MSMEs”).[xxxi] MSMEs are generally cash struck and involve small scale business activity. In fact, they are not even profitable.[xxxii]Their sheer size and scale prevents them from undertaking an extensive marketing exercise. Thus, any potential pre-pack insolvency regime needs to address the concern of marketing exercise, otherwise it is bound to fail.

2.      Independent valuations

Similar to the problem of marketing, the connected parties have an incentive to value business at a lower price so that they could ultimately purchase it. Thus, valuation of assets is an important issue in pre-pack regime.[xxxiii] For valuations obtained for a business and/or its underlying assets, tangible assets (plant and machinery, property, stock) as well as intangible assets (goodwill, database, website, patents, etc.) need to be included. To allow creditors to form a proper understanding of the pre-pack transaction, the valuation is critical. This would explain the nature of assets involved, and such matters as the amounts attributed to the various asset categories, the basis of the valuation and terms upon which the valuer has been instructed, as well as the basis upon which substantial allocations are made to maintain goodwill.

The problem is the valuation method used by the valuer. It could be easy to objectify such a method in case of tangible assets such as chattels and property but not intellectual property and goodwill.[xxxiv] Another issue is the nature of pre-pack arrangements often requires valuations to be carried out within a restricted time period, within which there might be insufficient time for normal investigations and research to be carried out.[xxxv] Lastly, the issue of soft information about the future business prospects of the corporate debtor is also an issue with regards to valuation.[xxxvi]

3.      Connected interests and the integrity of the process

One of the vital issues of the procedure is the fact that it puts the whole process exclusively in the hands of the insiders, precluding junior creditors from having any substantial input to the sale plan.[xxxvii] The deal is normally negotiated between the company management and the potential buyer with the assistance of insolvency professionals and approval from secured creditors of the company. There is thus a worry that ‘the advisors may have been too aligned with certain interests, which may be those of well-placed creditors or involved managers’.[xxxviii] The deal therefore is often perceived as an outcome of the compromise between the wish to sell the business back to management or to a connected party at a modest price and the requirement to cover the repayment of outstanding debt owed to major creditors.

4.      Transparency

The process of pre-pack insolvency is supposed to be an expeditious process.[xxxix] Within the time period of the process, it has to be ensured that a fair deal has been achieved. To assure this, proper transparency in the procedure is needed, especially while making the sales to the connected parties. Sales made to such parties at times, do not take into account all the information, present with the parties, which is not counted in valuation. Moreover, in today’s world, where data is becoming the new currency, such data is also not taken into account as an asset and not evaluated[xl]. This is because, such information can be concealed by the corporate debtor, if a pre-pack sale is being made to a promoter or connected party, so that other parties do not challenge the final amount at which the entity is sold to the connected party.[xli] To avoid this, proper transparency mechanism is needed.

Conclusion: A proposed model to include connected parties under Pre-pack

A number of issues have been identified in the models proposed by the two aforementioned organisations. This shows that the models need some changes. In fact, a new model is required to deal with the aspect of connected parties. Therefore, the authors would like to propose a working model towards the same –

1. An amendment needs to be made in Section 29A, essentially in the nature of a proviso under the provision so as to make an exception for the pre-packs, in order to allow promoters and connected parties to submit a resolution plan, thus allowing them to take part in the insolvency procedure. Proper regulations and guidelines need to be issued for the same by the Insolvency and Bankruptcy Board of India [“IBBI”].

   
   

2. Protection of existing management is important to ensure smooth functioning of business until the process is complete. Once the company decide that they need to avail the pre-package mechanism, an Insolvency professional needs to be appointed by the company. The professional would be appointed merely to overlook the complete procedure and would not control the management of the company.

   
   

3. An important concern that needs to be addressed is that of marketing exercise. This is the most crucial part of the process, as it would help the company to attain the best deal and restrict further challenges being made if the business is sold to a connected party. Thus, instead of merely making marketing a step of the process would not be helpful. Instead, the Indian case requires some kind of active involvement of the government for this activity. First, comprehensive guidelines should be issued by the government suggesting what exactly constitutes marketing and what should a business undertake to complete it. In this regard, a distinction needs to be drawn between the nature of entity and its ability to market itself. It needs to be emphasised that no every business is capable to marketing itself in distress. Therefore, the second solution could be that entities which are incapable of marketing themselves should be assisted by the government. While it is true that pre-package is ideally an internal process, the government could involve itself through a specialised agency. The specialised agency could help in the company meet the potential buyers in a confidential manner. While it is true that more regulation makes the process the more cumbersome, however, a balance needs to be drawn between compromising integrity of the process and including more regulation, amongst which, regulation is a lesser evil.

   
   

4. Simultaneously, proper evaluation needs to be done. For the same, a valuer needs to be appointed, who shall be governed by the Companies (Registered Valuers and Valuation) Rules, 2017.[xlii] Further, the valuation of intangible assets to be done by the valuer should be governed by the Indian Valuation Standards 101 provided by the Institute of Chartered Accountants of India. This is to bring objectivity in the valuation of the entity.

   
   

5. Next step should be submission of resolution plans. Additionally, if such a plan is submitted by a promoter or a connected party, it needs to be ensured that the person was not the cause of default, which lead to insolvency. For the same, a ‘committee of experts’ need to be appointed to assess the connected person’s position to submit a resolution plan (similar to a pre-pack pool process in UK).[xliii] It should be mandatory condition in case of a connected person. Their opinion should be recorded by the Insolvency Professional.

   
   

6. The insolvency professional should prepare a report on the feasibility of the proposed resolution plan.

   
   

7. Once the resolution plan is final, it should be submitted to the National Company Law Tribunal [“NCLT”], along with the feasibility report and the opinion of the committee of experts. At the same time, the Committee of Creditors should file a statement with NCLT, stating the reasons of accepting the resolution plan of a promoter or a connected person. They should also mention the alternatives they considered while assessing the resolution plan. This would ensure proper scrutiny of the mechanism.

   
   

*The authors are final-year students at National Law University, Jodhpur. This blog was adjudged as the winning entry for the CIBS-IBBI Essay Writing Competition 2021.

Bibliography

­Statutes

Insolvency and Bankruptcy Code, 2016

The Companies (Registered Valuers and Valuation) Rules, 2017

The Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016.

The Insolvency and Bankruptcy Code (Amendment) Act, 2018.

Treatises

BO XIE, COMPARATIVE INSOLVENCY LAW: THE PRE-PACK APPROACH IN CORPORATE RESCUE

Finch, ‘Pre-packaged Administrations: Bargains in the Shadow of Insolvency or Shadowy Bargains’

Frisby, ‘The Pre-pack Progression: Latest Empirical Findings’

Articles

A Keay, Company Directors’ Responsibilities to Creditors

Alastair Goldrein, ‘Unwrapping English pre-packaged administrations: a guide to “pre-packs” in England’

Andy Mukherjee, ‘View: India turns a bad-loan tragedy into a bankruptcyfarce

Armour, ‘The Law and Economics of Corporate Insolvency: A Review’

Lorraine Conway, ‘Pre-pack Administrations

Mark Hyde & Iain White, Pre-Pack Administrations: Unwrapped

Mason, ‘Pre-packs from the Valuer’s Perspective’

Milman, ‘Strategies for Regulating Managerial Performance in the “Twilight Zone” – Familiar Dilemmas: New Considerations’

Sanjana Rao, Insolvency Procedures- Investigating the Pre- Pack Paradigm

Thomas H. Jackson, Bankruptcy, Non-Bankruptcy Entitlements, and the Creditors’ Bargain

Varsha Banerjee and Garima Mehra, MSME’s And Insolvency And Bankruptcy Code

Committee Reports and Working Papers

M Crystal QC and R Mokal, ‘The Valuation of Distressed Companies – a Conceptual Framework’ (2006) BEPRESS Legal Series Working Paper

Ministry of Finance, Report of the Bankruptcy Law Reforms Committee – Volume I: Rationale and Design

MP Ram Mohan and Vishakha Raj, Pre-packs in the Indian Insolvency Regime, IIM-A Working Paper, August, 2020.

Otihjya Sen et. al., Designing a Framework for Pre-Packaged Insolvency Resolution in India: Some Ideas for Reform, VIDHI LEGAL POLICY.

P Walton and C Umfreville, Pre-pack Empirical Research: Characteristic and Outcome Analysis of Pre-pack Administration (Report to Graham Review, April 2014)

Teresa Graham, Graham Review into Pre-pack Administration, Gov.UK, 26, (Jun. 16 2014) https://www.gov.uk/government/publications/graham-review-into-pre-pack

Other Authorities

Insolvency and Bankruptcy Board of India Circular number IBBI/IP/013/2018 ‘Fee and other Expenses incurred for CIRP’ (2018) Insolvency and Bankruptcy Board of India.

Insolvency Service, 2013 Annual Review of Insolvency Practitioner Regulation (April 2014)

Panel report on pre-pack insolvency framework this month-end: IBBI Chief Sahoo, August 21, 2020.

Pre-Pack Pool: Annual Review 2017’ (May 2018).

Endnotes

[ii] Panel report on pre-pack insolvency framework this month-end: IBBI Chief Sahoo, August 21, 2020, https://www.thehindubusinessline.com/economy/panel-report-on-pre-pack-insolvency-framework-this-month-end-ibbi-chief-sahoo/article32413174.ece.

[iii] Mark Hyde & Iain White, Pre-Pack Administrations: Unwrapped, 3 Law & Fin. Mkt. Rev. 134 (2009).

[iv] Ministry of Finance, Report of the Bankruptcy Law Reforms Committee – Volume I: Rationale and Design (November 2015), https://ibbi.gov.in/BLRCReportVol1_04112015.pdf.

[v] Id.

[vi] Id.

[vii] The Insolvency and Bankruptcy Code (Amendment) Act, 2018.

[viii] Section 29A, the Insolvency and Bankruptcy Code, 2016.

[ix] The Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016.

[x] Sanjana Rao, Insolvency Procedures- Investigating the Pre- Pack Paradigm, the Law Review Government Law College, (2020) Volume 10, 69.

[xi] Id.

[xii] MP Ram Mohan and Vishakha Raj, Pre-packs in the Indian Insolvency Regime, IIM-A Working Paper, August, 2020.

[xiii] Andy Mukherjee, ‘View: India turns a bad-loan tragedy into a bankruptcyfarce’ (2018) Economic Times, at s://economictimes.indiatimes.com/industry/banking/finance/banking/india-turns-a-bad/.cms.

[xiv] Id.

[xv] BO XIE, COMPARATIVE INSOLVENCY LAW: THE PRE-PACK APPROACH IN CORPORATE RESCUE 8-9 (2016); Thomas H. Jackson, Bankruptcy, Non-Bankruptcy Entitlements, and the Creditors’ Bargain, 91 YALE L.J. 857, 861-62 (1982). 

[xvi] Teresa Graham, Graham Review into Pre-pack Administration, Gov.UK, 26, (Jun. 16 2014) https://www.gov.uk/government/publications/graham-review-into-pre-pack-administration#:~:text=The%20report%20was%20carried%20out,Government%20response%20to%20the%20Review. 

[xvii] Id.

[xviii] Lorraine Conway, ‘Pre-pack Administrations, House of Commons Library, Briefing Paper Number CBP5035’ (2017)       House of Commons Library, at http://researchbriefings.files.parliament.uk/ SN05035/SN05035.pdf.

[xix] Otihjya Sen et. al., Designing a Framework for Pre-Packaged Insolvency Resolution in India: Some Ideas for Reform, VIDHI LEGAL POLICY, 29-30, (Feb. 2020), https://vidhilegalpolicy.in/wp-content/uploads/2020/02/Report-on-Pre-Packaged-Insolvency-Resolution.pdf.

[xx] Pre-pack pool- It is a committee on experts which consists of a “pool of experienced business people”. Pre-Pack Pool, ‘Pre-Pack Pool: Annual Review 2017’ (May 2018), https://www.prepackpool.co.uk/uploads/files/documents/Pre-pack-Pool- Annual-Review-2017.pdf.

[xxi] MP Ram Mohan and Vishakha Raj, Pre-packs in the Indian Insolvency Regime, IIM-A Working Paper, August, 2020.

[xxii] M Crystal QC and R Mokal, ‘The Valuation of Distressed Companies – a Conceptual Framework’ (2006) BEPRESS Legal Series Working Paper 1370  http://law.bepress.com/expresso/eps/1370/.

[xxiii] Otihjya Sen et. al., Designing a Framework for Pre-Packaged Insolvency Resolution in India: Some Ideas for Reform, VIDHI LEGAL POLICY, 29-30, (Feb. 2020), https://vidhilegalpolicy.in/wp-content/uploads/2020/02/Report-on-Pre-Packaged-Insolvency-Resolution.pdf.

[xxiv] Id.

[xxv] Frisby, ‘The Pre-pack Progression: Latest Empirical Findings’, 156.

[xxvi] B Xie, ‘Protecting the Interests of General Unsecured Creditors in Pre-packs: the Implication and Implementation of SIP 16’ (2010) 31 Company Lawyer 189, 194.

[xxvii] The Insolvency Service, 2013 Annual Review of Insolvency Practitioner Regulation (April 2014), 10. The data of UK is being used because there is no available data if India yet.

[xxviii] P Walton and C Umfreville, Pre-pack Empirical Research: Characteristic and Outcome Analysis of Pre-pack Administration (Report to Graham Review, April 2014) https://www.gov.uk/government/publications/grahamreview-into-pre-pack-administration.

[xxix] Id.

[xxx] Id.

[xxxi] Varsha Banerjee and Garima Mehra, MSME’s And Insolvency And Bankruptcy Code, https://www.mondaq.com/advicecentre/content/3826/MSMEs-And-Insolvency-And-Bankruptcy-Code.

[xxxii] Ruchika Chitravanshi, MSME promoters likely to stay in charge during resolution process, https://www.business-standard.com/article/companies/msme-promoters-likely-to-stay-in-charge-during-resolution-process-120082100749_1.html.

[xxxiii] Insolvency and Bankruptcy Board of India Circular number IBBI/IP/013/2018 ‘Fee and other Expenses incurred for CIRP’ (2018) Insolvency and Bankruptcy Board of India, at http://ibbi.gov.in/webadmin/pdf/whatsnew/2018/Jun/Circular%20on%20Fee%20and%20other%20Expenses%20incurred%20for%20CIRP%20[June%202018]_2018-06-18%2014:06:58.pdf

[xxxiv] S Mason, ‘Pre-packs from the Valuer’s Perspective’ (Summer 2006) Recovery 20, 20.

[xxxv] Id.

[xxxvi] Armour, ‘The Law and Economics of Corporate Insolvency: A Review’. A Keay, Company Directors’ Responsibilities to Creditors(Cavendish, London 2006), 181–2.

[xxxvii] Milman, ‘Strategies for Regulating Managerial Performance in the “Twilight Zone” – Familiar Dilemmas: New Considerations’, 507.

[xxxviii] Finch, ‘Pre-packaged Administrations: Bargains in the Shadow of Insolvency or Shadowy Bargains’, 574.

[xxxix] Supra, Vidhi Report.

[xl] Mason, ‘Pre-packs from the Valuer’s Perspective’, [2006] Recovery (Summer) 20.

[xli] Alastair Goldrein, ‘Unwrapping English pre-packaged administrations: a guide to “pre-packs” in England’ (2011) Chadbourne & Parke LLP, at https://www.lexology.com/library/detail.aspx?g=da1945a8-be91-4557-9028-48c5e8993a39.

[xlii] The Companies (Registered Valuers and Valuation) Rules, 2017.

[xliii] Pre-Pack Pool, ‘Pre-Pack Pool: Annual Review 2017’ (May 2018), https://www.prepackpool.co.uk/uploads/files/documents/Pre-pack-Pool- Annual-Review-2017.pdf.