The IBC replaced debtor delay with a creditor-in-control process on the clock: admission, moratorium, committee of creditors, resolution plan — or liquidation. AMLEGALS advises financial and operational creditors, corporate debtors and resolution applicants across every stage of the corporate insolvency resolution process.
The Insolvency and Bankruptcy Code did not merely create a new forum; it inverted the incentives. Under the old regime a defaulting promoter could out-wait creditors for years. Under the Code, admission displaces management, a moratorium freezes the field, and a committee of creditors must find a resolution within a statutory outer limit of three hundred thirty days — or the company is liquidated. Time is the discipline that drives value, and the party that understands the timeline controls the outcome.
For a creditor, the decisive moves are early: establishing the default and the one-crore threshold, choosing the right trigger, and securing admission before the asset base erodes. For a corporate debtor, the questions are whether the default is curable, whether a pre-existing dispute defeats an operational creditor’s claim, and whether a Section 29A-compliant resolution preserves the enterprise. AMLEGALS advises on both sides of that contest, from the first demand notice to the approval of the plan.
Establishing the default, the one-crore threshold and the right trigger — Section 7, 9 or 10 — and the maintainability of the application.
Drafting and prosecuting or defending the insolvency petition before the National Company Law Tribunal up to the admission stage.
Advising on the Section 14 moratorium and the transition of control to the interim resolution professional.
Filing and defending claims, constitution of the committee of creditors, and representation of creditor interests in CoC decisions.
Preparation, evaluation and negotiation of resolution plans, including Section 29A eligibility of applicants and plan compliance.
Securing tribunal approval of the plan under Section 31, or challenging an approved plan or rejection on permissible grounds.
The corporate insolvency resolution process (CIRP) is the time-bound mechanism under the Insolvency and Bankruptcy Code 2016 for resolving the default of a corporate debtor. On admission by the National Company Law Tribunal, the management is displaced, an insolvency resolution professional takes control, a moratorium protects the assets, and a committee of creditors invites and approves a resolution plan that maximises value — failing which the company proceeds to liquidation. It is a creditor-in-control, not a debtor-in-possession, regime.
A financial creditor under Section 7, an operational creditor under Section 9, or the corporate debtor itself under Section 10 may apply. The minimum default that can trigger CIRP was raised by notification in March 2020 to one crore rupees. The applicant must establish a default of at least that amount; for operational creditors, a demand notice must precede the application and there must be no pre-existing dispute.
From the insolvency commencement date, Section 14 imposes a moratorium prohibiting the institution or continuation of suits against the corporate debtor, transfer or disposal of its assets, enforcement of security interests, and recovery of property by owners or lessors. The moratorium preserves the debtor as a going concern and gives the resolution professional breathing room to run the process, lasting until the plan is approved or liquidation is ordered.
The committee of creditors (CoC), comprising the financial creditors, is the decision-making body of the CIRP. It appoints or replaces the resolution professional, scrutinises and approves the resolution plan by the requisite voting majority (generally sixty-six per cent for key decisions), and exercises commercial judgement on the best resolution. The Supreme Court has repeatedly affirmed the primacy of the CoC’s commercial wisdom, which tribunals do not ordinarily second-guess on merits.
Section 12 sets an outer limit: CIRP must ordinarily complete within one hundred eighty days, extendable by ninety days, and in any event within three hundred thirty days including any extensions and the time taken in legal proceedings. While courts have recognised that the 330-day limit is not always mandatory in exceptional circumstances, the statutory intent is strict time-bound resolution, and delay is actively discouraged.
No. No engagement is treated as accepted until conflicts, scope and terms are confirmed in writing.
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