Section 362 of the Companies Act, 2013
Section 362 of the Companies Act, 2013 deals with:
Scheme for Rehabilitation and Insolvency of Sick Companies
Note: This section has been omitted by the Insolvency and Bankruptcy Code, 2016 (IBC).
📜 Original Intent of Section 362 (before omission):
Section 362 was part of Chapter XIX of the Companies Act, 2013, which provided for the revival and rehabilitation of sick companies (especially those with financial difficulties).
This section empowered the Tribunal (NCLT) to order preparation of a scheme for the rehabilitation and insolvency of a sick company, based on an application made by the company or any creditor.
The scheme could involve:
Financial restructuring
Merger or amalgamation
Sale of assets
Change in management
Or other measures necessary to revive the company
❌ Omission under IBC, 2016:
With the enactment of the Insolvency and Bankruptcy Code (IBC), 2016, Sections 253 to 269 of the Companies Act, 2013 (including Section 362) were omitted.
The IBC now governs all matters related to corporate insolvency, resolution, and liquidation.
✅ Current Status:
🔹 Section 362 is no longer in force.
🔹 For similar matters, the provisions of the Insolvency and Bankruptcy Code, 2016 apply.
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