Why in News?

• A recent National Company Law Tribunal (NCLT) order concerning Zee Group founder Subhash Chandra has revived concerns over deep haircuts under the Insolvency and Bankruptcy Code (IBC), 2016, as well as the integrity of the creditor-voting process.
• The NCLT approved a repayment plan offering only ₹6.25 crore against admitted claims of about ₹22,006.57 crore, apart from ₹25 lakh towards process costs.
• The case has raised questions about asset valuation, admission of claims, related-party creditors, voting rights and the balance between resolution and recovery.

What’s in Today’s Article?

• IBC - How Does the Resolution Process Work?
• The “Haircut” Problem
• Resolution vs Recovery - Government’s Position
• Banks’ Concerns - Valuation and Transparency
• IBC Still Performs Better Than Other Recovery Mechanisms
• Subhash Chandra Case - Why Is It Controversial?
• NCLT’s Serious Findings on Claim Verification
• Way Forward
• Conclusion

IBC - How Does the Resolution Process Work?

• The IBC, 2016 created a time-bound framework for dealing with financially distressed companies through either resolution or liquidation.
• Broad process:
  • A financial/defaulting creditor approaches the NCLT for initiation of insolvency proceedings.
  • A Resolution Professional (RP) takes charge of the process.
  • At least two registered valuers assess the debtor's assets.
• They determine -
  • Fair value: Estimated value of assets under their present condition.
  • Liquidation value: Expected realisation if assets are sold, generally through liquidation.
  • Enterprise value: Economic worth of the business as a going concern.
• Prospective resolution applicants submit plans. The Committee of Creditors (CoC) evaluates and votes on the plan. A plan approved by the requisite majority is submitted to the NCLT for final approval.
• Thus, IBC seeks to preserve the value of a viable enterprise rather than merely maximise immediate recovery.

The “Haircut” Problem:

• Haircut is not defined in the IBC. In banking terminology, it broadly denotes the reduction in the value recognised against a lender's claim or collateral.
• MCA data show that during FY2021-22 to FY2025-26, 1,077 cases were resolved under IBC, with creditors recovering around ₹2.47 lakh crore—an average recovery of roughly 29% of admitted claims.
• The 20% recovery in FY26, the lowest in the five-year period, has intensified the debate over whether IBC is adequately protecting creditors.

Resolution vs Recovery - Government’s Position:

• The government maintains that “resolution, not recovery” is the primary objective of the IBC.
• A creditor's admitted claim may include accumulated interest on NPAs; loans that have already substantially lost economic value; guarantees relating to such loans; and liabilities that do not correspond to currently recoverable assets.
• Therefore, comparing realisation mechanically with the total admitted claim may exaggerate the apparent haircut.
• The government also argues that IBC has improved credit discipline and contributed to the decline in banks' Gross NPAs, while post-resolution equity value may not be captured fully in conventional recovery calculations.

Banks’ Concerns - Valuation and Transparency:

• Banks have nevertheless highlighted concerns about excessive haircuts, particularly deficiencies in asset valuation.
• Key concerns:
  • Inadequate identification of assets.
  • Lack of uniform valuation methodologies.
  • Excessive reliance on liquidation value rather than enterprise/going-concern value.
  • Divergence between valuation reports.
  • Insufficient transparency in the conduct of valuers and auditors.
• SBI has argued for systems capable of better reflecting enterprise value, while Bank of Baroda emphasised that accurate and timely valuation is crucial for both creditor recovery and successful revival.
• Indian Overseas Bank has pointed to the absence of uniform sector-specific valuation standards, which can produce substantially different estimates of the same company's worth.

IBC Still Performs Better Than Other Recovery Mechanisms:

• Despite low recoveries, IBC has generally outperformed conventional debt-recovery mechanisms.
• In FY2024, recovery rates were 2% in Lok Adalats, 9.9% in Debt Recovery Tribunals (DRTs), 27.8% in SARFAESI, and 39% in IBC.
• In FY2024, it was 1.8% in Lok Adalats, 15.2% in DRTs, 24.7% in SARFAESI, and 28.3% in IBC.
• This distinction is important: IBC is primarily a resolution mechanism, whereas DRTs, Lok Adalats and SARFAESI are predominantly oriented towards enforcement and recovery.

Subhash Chandra Case - Why Is It Controversial?

• The controversy goes beyond the size of the haircut. Of 23 creditors participating in voting, the repayment plan received 80.814% of the votes, while banks opposing it collectively held only 19.186%.
• Banks alleged that at least five entities supporting the plan were associate/related parties of Chandra and therefore their votes should not have been counted.
• Chandra's office rejected the allegation, arguing that certain entities were connected to Jawahar Goel and that their business interests had been separated from Chandra's through a family business restructuring in 2008-09.

NCLT’s Serious Findings on Claim Verification:

• The NCLT identified significant deficiencies in the admission of claims.
• 1,260 questionable individual claims:
  • Claims filed through Anil Kumar and Sunil Jain, representing 960 and 300 individuals respectively, were admitted despite apparently inadequate documentary evidence.
  • The tribunal criticised the RP for admitting such claims without adequate due diligence and verification.
• Alleged related-party claims:
  • The tribunal also questioned claims associated with several entities, particularly where relationships with the personal guarantor appeared significant.
  • The NCLT also flagged allegations that some guarantees could have been collusive arrangements designed to create artificial liabilities.

Way Forward: The case highlights the need to strengthen the IBC ecosystem through -

• Transparent and standardised valuation methodologies across sectors.
• Greater emphasis on going-concern/enterprise value where businesses remain viable.
• Stronger scrutiny of related-party and associate-party claims.
• Robust documentary verification before admitting claims.
• Greater accountability of Resolution Professionals and valuers.
• Safeguards against artificial or collusive liabilities.
• Faster resolution to prevent further erosion of stressed assets.
• Better monitoring of creditor voting to preserve the integrity of the CoC process.

Conclusion:

• The central issue is not simply whether a particular haircut is “high”.
• The real question is whether the IBC process maximises the economic value of a distressed enterprise while ensuring fair treatment of creditors and preventing manipulation of claims and voting rights.
• A credible insolvency regime must therefore balance resolution, value maximisation, recovery, transparency and credit discipline.

Why in the News?

• PM Modi began a two-day state visit to Uzbekistan on August 29, 2026, before travelling to Bishkek for the 26th Shanghai Cooperation Organisation (SCO) Summit.

What’s in Today’s Article?

• India-Uzbekistan Relations (Background, Trade, Health & Education, Cultural Ties, etc.)
• News Summary (Key Highlights of PM Modi’s Visit to Uzbekistan)

India-Uzbekistan Relations

• India and Uzbekistan share historical links extending back to the Silk Road, which connected the Indian subcontinent with Central Asia. Cultural exchanges, trade and the movement of ideas have historically connected the two regions.
• Modern diplomatic relations were established after Uzbekistan became independent in 1991. Since then, bilateral ties have expanded from political engagement to cooperation in trade, investment, defence, healthcare, education, culture and technology.
• The relationship was elevated to a Strategic Partnership, reflecting the growing importance of Uzbekistan in India's engagement with Central Asia.

Economic and Trade Relations

• Economic engagement has expanded steadily, although there remains considerable scope for diversification.
• India is among Uzbekistan's top 10 trading partners, with bilateral trade reaching US$ 1.3 billion in 2025 (growth of 33.3% over the previous year).
• Uzbekistan’s exports to India stood at US$ 164.6 million (growth of 25.4%), while its imports from India reached US$ 1.15 billion.
• Indian investments in Uzbekistan are also close to US$1 billion, covering sectors such as:
  • Renewable energy, Construction, Pharmaceuticals, Mining, Information technology, Healthcare, Textiles, Agriculture, Engineering.
• The latest discussions are expected to focus on increasing trade and investment and strengthening business-to-business engagement.

Healthcare and Education

• Healthcare has emerged as an important area of cooperation. Nearly 14,000 Uzbek nationals visited India for medical treatment, making Uzbekistan the third-largest source country for medical tourism to India.
• Indian hospital groups also operate in Uzbekistan and conduct medical camps in areas such as cardiology, oncology and neurology.
• Education and skill development form another important pillar. More than 2,700 Uzbek nationals have received training through various programmes, while 426 candidates have benefited from ICCR scholarships.
• Four Indian universities are also present in Uzbekistan: Amity University in Tashkent, Sharda University in Andijan, Sambhram University in Jizzakh and Acharya University in Bukhara.

Cultural and People-to-People Relations

• The Indian diaspora in Uzbekistan numbers about 20,000 people, consisting mostly of Indian citizens, students, and professionals.
• The Yoga Federation of Uzbekistan, established in 2018, was supported by the Indian Council for Cultural Relations (ICCR), including through the deputation of an Indian yoga teacher.
• Uzbekistan became the first Central Asian country to conduct yoga certification examinations under India's Yoga Certification Board. So far, 528 Uzbeks have obtained yoga certifications. 

News Summary

• During the latest visit, Prime Minister Modi and President Shavkat Mirziyoyev are seeking to deepen cooperation across a broad range of sectors.
• The discussions are expected to cover trade and investment, critical minerals, healthcare, education, space, technology, culture and people-to-people exchanges.
• PM Modi described the visit as reflecting the depth and growing momentum of bilateral relations.
• It is his fourth visit to Uzbekistan and his second bilateral visit to the country.

Strategic Areas of Cooperation

• India's engagement with Uzbekistan has acquired greater importance because of the country's location in Central Asia and its relevance to India's interests in security, connectivity and energy.
• The two countries are expected to explore cooperation in critical minerals, alongside existing areas such as defence, energy and technology. For India, stronger engagement with Central Asia can also support efforts to diversify sources of energy and strategic resources.
• India's connectivity interests include projects such as the International North-South Transport Corridor (INSTC), while regional security cooperation has acquired greater importance following developments in Afghanistan.

Multilateral Cooperation

• India and Uzbekistan cooperate through several multilateral platforms, including the United Nations, G20, BRICS and SCO.
• At the regional level, both countries participate in the India-Central Asia Summit and the India-Central Asia Dialogue. The first India-Central Asia Summit was held in 2022. Uzbekistan also participated in BRICS activities organised under India's 2026 chairship.

Conclusion

• India-Uzbekistan relations have evolved into a broad strategic partnership encompassing economic, security, technological, cultural and human connections.
• The latest engagement seeks to build on this foundation by expanding cooperation in emerging areas such as critical minerals, digital connectivity and space, while strengthening established partnerships in healthcare, education and culture.
• For India, Uzbekistan remains an important partner in advancing its wider Central Asia strategy.

Why in news?

Recently, the Supreme Court ordered the Ghaziabad Police to provide independent journalist Abhishek Upadhyay with a copy of the FIR and CCTV footage in a road-rage case registered against him.

Upadhyay, who had reported on alleged irregularities in donations to the Ram Mandir in Ayodhya, claimed he was being falsely implicated over his reportage and that police had repeatedly denied him access to the FIR.

What’s in Today’s Article?

• Background: Why the Court Had to Intervene?
• What Do Statutory Provisions Say?
• FIR Access: Judicial Precedents
• Why This Matters: Implications for the Accused

Background: Why the Court Had to Intervene?

• The sequence of events leading to the Supreme Court's intervention:
  • Upadhyay alleged that a police team arrived at his residence, informing him of a case registered at Indirapuram police station over road rage and abusive behaviour.
  • Despite repeated requests, police initially sent him a page containing neither the sections invoked nor details of the alleged offence.
  • Police later shared an older, unrelated FIR registered against him in Lucknow instead.
  • Upadhyay approached the Supreme Court, alleging the case was based on concocted allegations intended to harass him for his journalism.
  • He sought a copy of the FIR and quashing of proceedings, or alternatively, transfer of the probe to an independent agency.
• A three-judge Bench headed by Chief Justice of India Surya Kant directed the Ghaziabad Police Commissioner to provide the FIR and CCTV footage, and file a compliance report by September 7.
• The Court also protected Upadhyay from arrest and permitted him to approach the jurisdictional High Court for further relief.

What Do Statutory Provisions Say?

• The Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS) does not require police to furnish an FIR to the accused immediately upon registration:
  • Section 173(2): Requires a copy to be given "forthwith" and free of cost — but only to the informant or victim, not the accused.
  • Section 230: Requires the magistrate to furnish the accused with copies of prosecution documents, including the FIR and chargesheet, within 14 days of their appearance or production before the court.
• The BNSS is silent on an accused's right to access the FIR at any earlier stage, including during investigation
• Judicial precedents, however, have stepped in to recognise this right.

FIR Access: Judicial Precedents

• Court on its Own Motion v. State (Delhi HC, 2010): Laid down a mechanism for an accused to obtain an FIR during investigation, before the Section 230 stage. Directed Delhi Police to upload FIRs online within 24 hours of registration, with sensitive offences exempted via a reasoned decision by an officer not below DCP rank.
• Rama Nand Rathore v. State of Himachal Pradesh (HP HC, 2014): Held that a person who suspects they are named in an FIR can seek a certified copy, which police must supply within 24 hours; also mandated online publication within the same period, barring sensitive cases.
• Youth Bar Association of India v. Union of India (SC, 2016): Extended these directives pan-India, reiterating that an accused is entitled to access the FIR before the Section 207 CrPC (now Section 230 BNSS) stage. The Court mandated:
  • FIRs uploaded on police websites within 24 hours of registration, or on the State government's official website where no police website exists.
  • Extension to 48 hours where unavoidable delays occur, or up to 72 hours for geographical connectivity issues.
• The 'Sensitive Offence' Exemption
  • The 2016 ruling carved out an exception to online publication for FIRs involving "sensitive" offences:
    • The Supreme Court identified sexual offences, cases under the POCSO Act, 2012, and terror offences as examples — clarifying the list is not exhaustive.
    • The decision to withhold an FIR cannot be taken by an officer below the rank of Deputy Superintendent of Police (DSP) or equivalent.
    • An aggrieved person can approach the Superintendent of Police or equivalent, who must constitute a three-member committee to decide the grievance within three days.
    • Even where withheld on sensitivity grounds, the accused or an authorised representative can apply to the magistrate (to whom the FIR has been forwarded) for a certified copy, which must be provided within three days.

Why This Matters: Implications for the Accused

• Police officials routinely fail to comply with the Supreme Court's directive to upload FIRs through the Crime and Criminal Tracking Network and Systems (CCTNS).
• Once an FIR is registered and criminal law is set in motion, the accused becomes entitled to pursue pre-trial remedies such as quashing of the FIR or anticipatory bail — but without access to the FIR, these remedies cannot be effectively exercised.
• The Supreme Court's ruling recognised a crucial principle: an accused cannot be made to wait until the framing of charges to learn the offences alleged against them, as this would undermine the right to a fair trial and principles of natural justice.

Why in news?

The Food Safety and Standards Authority of India (FSSAI) is tightening its regulatory grip on how packaged foods are marketed and labelled.

Two parallel developments illustrate this shift: a crackdown on misleading health and nutrient claims — exemplified by Mondelez India's withdrawal of such claims around Bournvita — and a Supreme Court-prompted proposal to introduce red hexagonal warning labels on unhealthy packaged snacks.

What’s in Today’s Article?

• The Scale of the Crackdown
• The Bournvita Case
• The Problem with "100%" and Similar Terms
• Extending Scrutiny to E-Commerce
• The Underlying Goal — and Its Limits
• Proposed Warning Labels for Unhealthy Snacks

The Scale of the Crackdown

• FSSAI has issued more than 150 notices to food companies in recent months over misleading advertisements, false claims, and labelling non-compliance.
• The list includes major packaged-food and beverage companies — Nestlé India, PepsiCo, Coca-Cola India, Abbott India, Red Bull India, Danone India, Mondelez India, Ferrero India, and Kenvue.

The Bournvita Case

• Bournvita has drawn particular scrutiny because its marketing has historically been closely tied to children's nutrition, coming under public criticism in 2023 over its sugar content and nutritional claims.
• Importantly, FSSAI's action does not establish that Bournvita is unsafe. The regulatory concern is narrower:
  • Whether specific health or nutrient-comparison claims are adequately substantiated;
  • Whether their presentation could mislead consumers about health outcomes.
• Analysts explained that food regulation extends beyond checking permitted ingredients to governing how a product's benefits are communicated — since claims suggesting specific health outcomes can create expectations beyond what the evidence supports.
• Mondelez has since withdrawn the flagged claims and removed related advertisements from e-commerce platforms.

The Problem with "100%" and Similar Terms

• A related concern involves absolute-sounding terms like "100%." In May 2025, FSSAI advised food businesses to stop using such language on labels and promotional material, reasoning that it could convey a "false sense of absolute purity or superiority."
• Words like "pure," "natural," "healthy," and "immunity-boosting" function as powerful marketing devices that can influence purchases even before consumers examine nutrition panels.
• Recent corrective actions include:
  • Amway India: removed "100%" from its coconut oil packaging and dropped the "Energy Drink" label from its caffeinated products
  • Juza Foods (Kerala): withdrew immunity and bone-strength claims from its baby-food products

Extending Scrutiny to E-Commerce

• Enforcement has extended beyond physical packaging to e-commerce platforms and food-service establishments.
• This matters because online product pages often carry claims, images, and promotional language that differ from what appears on physical packages — and consumers increasingly make purchase decisions based on online banners rather than in-store labels.

The Underlying Goal — and Its Limits

• At its core, this campaign aims to shift food marketing from broad, unverifiable language toward demonstrable claims — a push FSSAI has linked to India's rising concerns over obesity and unhealthy diets.
• However, questions remain about effectiveness: companies can remove a claim after receiving a notice, but consumers may have already encountered it for years, and similar messaging can persist elsewhere even as one platform complies.
• This makes sustained monitoring, not just notice-issuing, critical to ensuring compliance becomes routine rather than a one-time reaction to scrutiny.

Proposed Warning Labels for Unhealthy Snacks

• Prompted by the Supreme Court, FSSAI has proposed introducing a red hexagonal front-of-pack warning label for packaged foods high in salt, added sugar, or added fat.
• The goal is to provide a "simple, prominent and easily comprehensible warning" to consumers.
• The apex court is hearing this matter in response to a plea by Kerala-based non-profit 3S and Our Health Society.
• Design and Format
  • While no formal notification or implementation timeline exists yet, FSSAI's affidavit specifies:
    • The label will appear in English.
    • Font size will be one point larger than the nutritional information table at the back of the pack.
    • Declarations will include "high fat," "high sugar," "high salt," or "highly sweetened beverage," as applicable.
    • Thresholds are based on the Dietary Guidelines for Indians, 2024, issued by ICMR-National Institute of Nutrition.
• Phased Implementation
• Implementation will occur in two phases:
  • Phase I: Only products high in at least two of the specified ingredients will require the warning label
  • Phase II: Coverage will extend to products high in even a single ingredient
• Single-ingredient products and foods inherently rich in fat, sugar, or salt — such as ghee, edible oil, sugar, jaggery, and honey — will be exempted, subject to other labelling regulations.
• FSSAI says the phased approach aims to build consumer acceptability while giving industry time for reformulation.
• Expert Concerns
  • Nutrition experts have welcomed the initiative in principle but flagged significant implementation concerns:
    • The two-nutrient threshold: Many unhealthy products are high in just one nutrient and would escape the Phase I requirement, potentially rendering the label ineffective.
    • No Phase II timeline: FSSAI has not specified when the stricter single-nutrient threshold will apply.
    • The "added" ambiguity: Warnings apply only to added sugar or added fat, which is difficult to estimate — and naturally high sugar levels can be equally harmful.
    • Accessibility gaps: The proposed font size is too small, and the warning should also be available in Hindi.

Conclusion

Together, these developments signal a broader FSSAI effort to move Indian food regulation beyond ingredient safety toward truthful communication and consumer protection — addressing both misleading marketing language and the need for clear, upfront nutritional warnings.

However, the effectiveness of both initiatives hinges on rigorous, sustained enforcement and closing loopholes such as narrow nutrient thresholds and ambiguous terminology, ensuring that regulatory intent translates into meaningful consumer protection rather than symbolic compliance.

About National Test House:

• It is a premier scientific organization of the Government of India.
• It was established in 1912 under the then Railway Board.
• Mandate: It is India’s largest multi-location multidisciplinary industrial central government’s testing laboratory dealing with almost all sorts of testing, calibration and quality evaluation related to industry, commerce, trade etc. as per international and national standards.
• Functions
  • Technical Role: It offers technical consultancy, testing, calibration, and quality evaluation across various sectors, adhering to both national and international standards.
  • Accreditation Role: It is also actively involved in supporting the National Accreditation Board for Testing and Calibration Laboratories (NABL) and BIS by providing technical assistance in the accreditation and standard formation activities, respectively.
  • Drone certification: It is the pioneering governmental entity in India for drone certification.
  • Other Functions: Testing, Electric Vehicle (EV) Battery Testing, Organic Food Testing and other advanced technological areas.
• Its branches are established at Kolkata, Mumbai, Chennai, Ghaziabad, Jaipur, Guwahati, and Varanasi.
• Nodal Ministry: It is functioning under the administrative control of the Department of Consumer Affairs, Ministry of Consumer Affairs, Food & Public Distribution.

About Sesame:

• Sesame (Sesamum indicum L.) is the oldest indigenous oilseed crop in India.
• It is a primordial oilseed crop since the remnants of sesame seeds were discovered at Harappa and Mohenjodaro.
• Required Climate Conditions:
  • It can be cultivated up to the latitude of 1600m (India 1200 m).
  • Temperature: Normally the optimum temperature required during its life cycle is between 25-35 degrees celsius.
  • If the temperature is more than 40 degrees Celsius with hot winds the oil content reduces.
  • Soil: Sesame can be grown on a wide range of soils, however well drained light to medium textured soils are preferred. It does best on sandy loams with adequate moisture.
  • Climate: It thrives in the semi-arid climate of Western India, Central, Eastern and Southern part of India including lower Himalayas.
  • Season: It is cultivated during Kharif in arid and semi-arid tropics and rabi/summer in cooler areas.
• The crop is grown in almost all parts of the country. More than 85% production of sesame comes from West Bengal, Madhya Pradesh, Rajasthan, Uttar Pradesh, Gujarat, Andhra Pradesh and Telangana.
• Uses: Sesame oil is excellent from a medicinal point of view. It contains antioxidants, and it is perfect for heart patients.

About Pusa DST Rice 1:

• It is derived from MTU1010, which is suitable for rabi season in southern states.
• It is developed by Indian Council of Agricultural Research (ICAR)-Indian Agricultural Research Institute (IARI), New Delhi.
• Properties: The edit in its genome targets the Drought and Salt Tolerance (DST) gene, with the aim of improving the plant’s ability to cope with drought and salt-affected soils.
• It is expected to be grown in Andhra Pradesh, Telangana, Karnataka, Tamil Nadu, Kerala, Chhattisgarh, Odisha, Madhya Pradesh, Maharashtra, Jharkhand, Bihar, Uttar Pradesh and West Bengal.

About DRR Dhan 100:

• It is also called Kamala variety.
• It was developed by ICAR-Indian Institute of Rice Research, Hyderabad, from the popular Samba Mahsuri (BPT 5204) variety.
• Scientists edited a gene involved in cytokinin metabolism, with the aim of increasing the number of grains produced by each panicle.
• Properties: The resulting variety is said to mature about 20 days earlier than Samba Mahsuri, in around 130 days, and has a stronger stalk that is less prone to lodging, or falling over.