BEYOND DEBT RECOVERY: REIMAGINING THE INSOLVENCY AND BANKRUPTCY CODE, 2016 AS AN INSTRUMENT OF CORPORATE GOVERNANCE AND ECONOMIC CONSTITUTIONALISM IN INDIA

The Insolvency and Bankruptcy Code, 2016 (IBC) is one of the most significant structural reforms in India's post-liberalisation legal framework. Although commonly viewed as a mechanism for time-bound insolvency resolution, its significance extends beyond debt recovery. The Code marks a shift from a debtor-centric system to a creditor-driven governance model that promotes market discipline, institutional accountability, and efficient capital allocation. It has consequently emerged not merely as an insolvency statute but as an instrument of economic governance that advances constitutional values of fairness, transparency, equality, and economic efficiency.This paper examines the transformation of India's insolvency regime through an interdisciplinary approach combining legal doctrine, corporate governance, constitutional principles, and economic analysis. It analyses the evolution of the IBC through landmark Supreme Court decisions, including Innoventive Industries Ltd. v. ICICI Bank Ltd., Swiss Ribbons Pvt. Ltd. v. Union of India, Committee of Creditors of Essar Steel India Ltd. v. Satish Kumar Gupta, K. Sashidhar v. Indian Overseas Bank, Ebix Singapore Pvt. Ltd. v. Committee of Creditors of Educomp Solutions Ltd., and Vidarbha Industries Power Ltd. v. Axis Bank Ltd. The paper also evaluates the practical performance of the insolvency framework by examining institutional delays, resolution outcomes, liquidation trends, and the functioning of the National Company Law Tribunal. While acknowledging the IBC's contribution to strengthening creditor confidence and improving India's credit culture, the paper argues that challenges such as judicial delays, valuation disputes, inconsistent jurisprudence, and institutional capacity constraints continue THE INDIAN JOURNAL FOR RESEARCH IN LAW AND MANAGEMENT, VOL. 3, ISSUE 10, JULY - 2026 to affect its effectiveness. It concludes that the future of Indian insolvency law depends less on frequent legislative amendments than on stronger institutions, continued judicial restraint, and reforms addressing cross-border insolvency and technological developments.