Unsecured creditors to be paid before government dues

Repayment of dues to unsecured creditors has been given a higher priority as against payment of taxes to the government. A close reading of the Insolvency and Bankruptcy Code, 2015 (insolvency bill), shows that the order of priority of repayment of outstanding dues from liquidated assets of the insolvent company is proposed to be changed via suitable amendments in tax laws.
The insolvency bill emphasizes: "It may be noted that unsecured financial creditors shall be paid before the government. This is intended to promote alternative sources of finance and the consequent development of bond markets in India."