Regulatory overlap and conflict: A legal analysis of IBC and SEBI

The government of India passed the “Insolvency and Bankruptcy Code in 2016”, combining laws pertaining to individual, corporate insolvency and bankruptcy. This law created the “Insolvency & Bankruptcy Board of India” and the NCLT “(National Company Law Tribunal)” as regulatory bodies for the purpose of the management of India's bankruptcy and insolvency procedures. The SEBI (“securities and Exchange Board of India”) oversees “the securities market of India”. In 1992 it was founded with the intention of safeguarding securities investors' interests and advancing the growth of the securities industry. Among SEBI's responsibilities are securities market regulation, securities market intermediary registration, and enforcement of securities law compliance. The similarities and differences between IBC and SEBI, as well as the ways in which they interact, would be the main topics of a
comparative study. The goal of both SEBI and IBC legislation is to safeguard stakeholders' interests. While SEBI seeks to safeguard the interests of securities investors, IBC seeks “to protect the interests of creditors”, employees, & shareholders throughout insolvency and bankruptcy resolution process. “Under Section 28A of The Securities and Exchange Board of India Act, 1992 states that the profits of debtors may be recovered through the attachment of bank accounts, immovable and movable property, etc., to satisfy penalties or to guarantee adherence to SEBI rules and guidelines”. However, it is not possible to read this SEBI provision in isolation or without interpreting it in conjunction with Sections 14 and 238 of the “Insolvency and Bankruptcy Code, 2016”. Section 14 of “IBC” addresses the declaration of a moratorium on the start of the “CIRP (Corporate Insolvency Resolution Process)”. “It states that after the CIRP has been started, no new lawsuit should be filed or an existing lawsuit should be continued in any court, tribunal, or arbitration 2 panel”. “According to under Section 238 of the Insolvency Bankruptcy Code, provisions of the other laws must not conflict with one another”.