The Upper House passed the Bill by a voice vote.
A majority of opposition parties supported 'The Insolvency and Bankruptcy Code (Second Amendment) Bill, 2020', which was passed by Rajya Sabha on Saturday, and also urged the government to provide interest waiver on loans to farmers and poor people suffering due to the COVID crisis.
During the debate on the Bill, which grants relief to companies from fresh insolvency proceedings for at least six months starting March 25 in view of the pandemic, many members expressed fears over its possible misuse by corporates, while hoping that it will help in reviving the economy.
The Upper House passed the Bill by a voice vote.
Participating in the debate on the bill, K K Ragesh (CPI-M) said Finance Minister Nirmala Sitharaman and other members have told the House that the bill has been brought to save businesses and corporates.
"Why the same logic is not applied in the case of farmers? Farmers are also bankrupt. Why the government is not taking any responsibility and any initiative in waiving the farmers' loans?" he asked, and added that government could have considered to "waive the interest on loans to farmers during the moratorium period".
The CPI-M member also expressed apprehension that this Bill "is going to push the banking sector into a deep crisis", alleging that banking has become a bonanza for "fraud" companies and "corporate fraud is being encouraged through IBC".
"Why are huge haircuts being provided to big corporates? Banks are only able to realise less than 50 per cent of advances in many cases," he claimed.
DMK member P Wilson said, "there is a discrimination between common man and corporate. Why is this discrimination? Is the government here for crony corporates?"
He demanded that the government waive repayments of all bank loans and credit card bills. He also asked for a complete waiver of agriculture term loans.
Initiating the debate, Congress member Vivek Tankha said the government should protect only those businesses which are affected by COVID-19 pandemic and not all defaulters.
"The entire object of IBC Code is compromised by this amendment. The Code aims to prevent wilful default by companies...Do we want to protect COVID-19 category of industries or all industries irrespective of their performance in the past," he said.
About giving relief under the IBC, Arun Singh (BJP) said, "It was very much needed. It was very difficult to find out which transaction is COVID related....If my friends can tell that these are Covid-related transactions and these are not related to that then I will be very happy. But it is simply impossible."
Praful Patel (NCP) said there is nothing in the Bill to object to, but called for relief in the form of interest subvention for tourism and airline sectors as they are in financial stress.
"We need to go in for major amendments in the Bill, he said. There is going to be a serious problem even in the post-moratorium period. We may have to think 'out of the box' to help businesses, the way things are.
"Going by the business environment, there is a need for a lot of hand-holding. You need to do something more as the country will progress if its economy does well," he said.
TMC member Dinesh Trivedi said, "The intention of the bill is good. But you are in a hurry to do things without larger consultations. That is why the Bill is hastily drafted and an ill-worded piece of legislation, which would defeat its own purpose."
He called for putting money into bank accounts of needy, saying it would help create demand, generate jobs and tax revenue for the government.
Manoj Kumar Jha (RJD) urged Sitharaman to look at the wisdom across the aisle and accept suggestions given by the Opposition.
Shiv Sena's Anil Desai said unscrupulous or dishonest corporates should not take advantage of the pandemic situation and siphon off funds that have been made available to them by banks during the pandemic.
Ram Chandra Prasad Singh of the JD(U) supported the Bill, saying it is progressive and will help revive the economy and achieve the target of USD 5-trillion economy.
Narain Dass Gupta (AAP) alleged discrimination among big and small borrowers in providing relief during the pandemic, saying while major ones are being given moratorium on interests for one year, the smaller ones are not.
Veer Singh (BSP) asked whether a personal guarantor should be held accountable in case of a default on a loan.
Binoy Viswam (CPI) said the Finance Minister should not "blame God" for the pandemic situation as it is the "greed of the man" which is making them eat into the economy.
"This Bill is not touching the real problems. The IBA (Indian Banks' Association) has come out with a list of wilful defaulters and the government should help get that people's money back," he said.
"This is people's money. Please help get that amount back," he said, calling for giving money to the poor in these difficult times that will help revive the economy.
Ravi Prakash Verma (SP) was of the view that this Bill will support big corporate and also asked the government about the wilful defaulters who have fled the country.
Amar Patnaik (BJD) asked the government to improve the quality of debt resolution as well as competence of insolvency professionals.AIADMK leader A Vijaykumar suggested that cooperative societies should not be brought under the insolvency code. TDP's K Ravindra Kumar also spoke on the Bill.