Amendments to insolvency law are aimed at ensuring greater timeliness for resolution process, which has to be completed in 330 days, and changes are to made in seven sections of the law, corporate affairs minister Nirmala Sitharaman said on Thursday.

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Moving the Insolvency and Bankruptcy Code (Amendment) Bill, 2019 for passage in Lok Sabha, she said the changes would also bring in more clarity on various provisions, including time-bound disposal at the application stage for resolution plan and treatment of financial creditors.

As many as seven sections of the Code are to be amended. Once the Corporate Insolvency Resolution Process (CIRP) begins, it has to be completed in 330 days, including litigation stages and judicial process, the minister said citing the proposed amendments.

Among others, the approved resolution plan would be binding on central and state governments as well as various statutory authorities.

Sitharaman said proposed amendments also responds to issues pertaining to financial creditors in the wake of a recent ruling with respect to financial and operational creditors.

Recently, the National Company Law Appellate Tribunal (NCLAT) had ruled in the Essar Steel Ltd's case that the Committee of Creditors (CoC) had no role in distribution of claims and brought lenders (financial creditors) and vendors (operational creditors) on par.

Sitharaman quoted a Supreme Court judgement to say that with implementation of the Code, there is no longer a defaulter's paradise. The bill was passed by Rajya Sabha on Monday.