Jignesh Shah vs. Union of India

Abstract

India is a fast-developing economy, to sustain such growth a healthy cash flow is required. This cash flow is brought in by businesses and companies. But when a company or business begins to default on its loans, it is referred to as becoming insolvent. This causes credit to become trapped in the system or to convert into bad loans. It is crucial that creditors and banks are able to recover as much as possible from the defaulter in order to prevent this. Therefore, a number of regulations were enacted to allow credit to enter the system and to minimize the depreciation of assets' value.