New Delhi, June 29 -- The government has amended the Insolvency and Bankruptcy Code (IBC) to make it mandatory for the National Company Law Tribunal (NCLT) to admit insolvency applications filed by financial creditors once a payment default is established, a move aimed at reducing delays in corporate insolvency proceedings.

Amendment Makes Admission of Insolvency Cases Mandatory

Under the IBC (Amendment) Act, 2026, the government has replaced the word 'may' with 'shall' in Section 7(5) of the Code, removing the NCLT's discretion to defer or reject Corporate Insolvency Resolution Process (CIRP) applications after default has been verified through Information Utility (IU) records.

The amendment effectively overturns the Supreme Court's r...