The Insolvency and Bankruptcy Code `2016

An Act to consolidate and amend the laws relating to reorganisation and insolvency resolution of corporate persons, partnership firms and individuals in a time bound manner for maximisation of value of assets of such persons, to promote entrepreneurship, availability of credit and balance the interests of all the stakeholders including alteration in the order of priority of payment of Government dues and to establish an Insolvency and Bankruptcy Board of India, and for matters connected therewith or incidental thereto.
2016
  • CHAPTER II CORPORATE INSOLVENCY RESOLUTION PROCESS

  • 6
     Persons who may initiate corporate insolvency resolution process
  • 7
     Initiation of corporate insolvency resolution process by financial creditor
  • 8
     Insolvency resolution by operational creditor
  • 9
     Application for initiation of corporate insolvency resolution process by operational creditor
  • 10
     Initiation of corporate insolvency resolution process by corporate applicant
  • 11
     Persons not entitled to make application
  • 12
     Time-limit for completion of insolvency resolution process
  • 12A
     Withdrawal of application admitted under section 7, 9 or 10
  • 13
     Declaration of moratorium and public announcement
  • 14
     Moratorium
  • 15
     Public announcement of corporate insolvency resolution process
  • 16
     Appointment and tenure of interim resolution professional
  • 17
     Management of affairs of corporate debtor by interim resolution professional
  • 18
     Duties of interim resolution professional
  • 19
     Personnel to extend co-operation to interim resolution professional
  • 20
     Management of operations of corporate debtor as going concern
  • 21
     Committee of creditors
  • 22
     Appointment of resolution professional
  • 23
     Resolution professional to conduct corporate insolvency resolution process
  • 24
     Meeting of committee of creditors
  • 25
     Duties of resolution professional
  • 25A
     Rights and duties of authorised representative of financial creditors
  • 26
     Application for avoidance of transactions not to affect proceedings
  • 27
     Replacement of resolution professional by committee of creditors
  • 28
     Approval of committee of creditors for certain actions
  • 29
     Preparation of information memorandum
  • 30
     Submission of resolution plan
  • 31
     Approval of resolution plan
  • 32
     Appeal
  • 32A
     Liability for prior offences, etc
  • CHAPTER III LIQUIDATION PROCESS

  • 33
     Initiation of liquidation
  • 34
     Appointment of liquidator and fee to be paid
  • 35
     Powers and duties of liquidator
  • 36
     Liquidation estate
  • 37
     Powers of liquidator to access information
  • 38
     Consolidation of claims
  • 39
     Verification of claims
  • 40
     Admission or rejection of claims
  • 41
     Determination of valuation of claims
  • 42
     Appeal against the decision of liquidator
  • 43
     Preferential transactions and relevant time
  • 44
     Orders in case of preferential transactions
  • 45
     Avoidance of undervalued transactions
  • 46
     Relevant period for avoidable transactions
  • 47
     Application by creditor in cases of undervalued transactions
  • 48
     Order in cases of undervalued transactions
  • 49
     Transactions defrauding creditors
  • 50
     Extortionate credit transactions
  • 51
     Orders of Adjudicating Authority in respect of extortionate credit transactions
  • 52
     Secured creditor in liquidation proceedings
  • 53
     Distribution of assets
  • 54
     Dissolution of corporate debtor
  • CHAPTER IV FAST TRACK CORPORATE INSOLVENCY RESOLUTION PROCESS

  • 55
     Fast track corporate insolvency resolution process
  • 56
     Time period for completion of fast track corporate insolvency resolution process
  • 57
     Manner of initiating fast track corporate insolvency resolution process
  • 58
     Applicability of Chapter II to this Chapter
  • CHAPTER V VOLUNTARY LIQUIDATION OF CORPORATE PERSONS

  • 59
     Voluntary liquidation of corporate persons
  • CHAPTER VI ADJUDICATING AUTHORITY FOR CORPORATE PERSONS

  • 60
     Adjudicating Authority for corporate persons
  • 61
     Appeals and Appellate Authority
  • 62
     Appeal to Supreme Court
  • 63
     Civil court not to have jurisdiction
  • 64
     Expeditious disposal of applications
  • 65
     Fraudulent or malicious initiation of proceedings
  • 66
     Fraudulent trading or wrongful trading
  • 67
     Proceedings under section 66
  • CHAPTER VII OFFENCES AND PENALTIES

  • 68
     Punishment for concealment of property
  • 69
     Punishment for transactions defrauding creditors
  • 70
     Punishment for misconduct in course of corporate insolvency resolution process
  • 71
     Punishment for falsification of books of corporate debtor
  • 72
     Punishment for wilful and material omissions from statements relating to affairs of corporate debtor
  • 73
     Punishment for false representations to creditors
  • 74
     Punishment for contravention of moratorium or the resolution plan
  • 75
     Punishment for false information furnished in application
  • 76
     Punishment for non-disclosure of dispute or payment of debt by operational creditor
  • 77
     Punishment for providing false information in application made by corporate debtor
  • CHAPTER I PRELIMINARY

  • 78
     Application
  • 79
     Definitions
  • CHAPTER II FRESH START PROCESS

  • 80
     Eligibility for making an application
  • 81
     Application for fresh start order
  • 82
     Appointment of resolution professional
  • 83
     Examination of application by resolution professional
  • 84
     Admission or rejection of application by Adjudicating Authority
  • 85
     Effect of admission of application
  • 86
     Objections by creditor and their examination by resolution professional
  • 87
     Application against decision of resolution professional
  • 88
     General duties of debtor
  • 89
     Replacement of resolution professional
  • 90
     Directions for compliances of restrictions, etc
  • 91
     Revocation of order admitting application
  • 92
     Discharge order
  • 93
     Standard of conduct
  • CHAPTER III INSOLVENCY RESOLUTION PROCESS

  • 94
     Application by debtor to initiate insolvency resolution process
  • 95
     Application by creditor to initiate insolvency resolution process
  • 96
     Interim moratorium
  • 97
     Appointment of resolution professional
  • 98
     Replacement of resolution professional
  • 99
     Submission of report by resolution professional
  • 100
     Admission or rejection of application
  • 101
     Moratorium
  • 102
     Public notice and claims from creditors
  • 103
     Registering of claims by creditors
  • 104
     Preparation of list of creditors
  • 105
     Repayment plan
  • 106
     Report of resolution professional on repayment plan
  • 107
     Summoning of meeting of creditors
  • 108
     Conduct of meeting of creditors
  • 109
     Voting rights in meeting of creditors
  • 110
     Rights of secured creditors in relation to repayment plan
  • 111
     Approval of repayment plan by creditors
  • 112
     Report of meeting of creditors on repayment plan
  • 113
     Notice of decisions taken at meeting of creditors
  • 114
     Order of Adjudicating Authority on repayment plan
  • 115
     Effect of order of Adjudicating Authority on repayment plan
  • 116
     Implementation and supervision of repayment plan
  • 117
     Completion of repayment plan
  • 118
     Repayment plan coming to end prematurely
  • 119
     Discharge order
  • 120
     Standard of conduct
  • CHAPTER IV BANKRUPTCY ORDER FOR INDIVIDUALS AND PARTNERSHIP FIRMS

  • 121
     Application for bankruptcy
  • 122
     Application by debtor
  • 123
     Application by creditor
  • 124
     Effect of application
  • 125
     Appointment of insolvency professional as bankruptcy trustee
  • 126
     Bankruptcy order
  • 127
     Validity of bankruptcy order
  • 128
     Effect of bankruptcy order
  • 129
     Statement of financial position
  • 130
     Public notice inviting claims from creditors
  • 131
     Registration of claims
  • 132
     Preparation of list of creditors
  • 133
     Summoning of meeting of creditors
  • 134
     Conduct of meeting of creditors
  • 135
     Voting rights of creditors
  • 136
     Administration and distribution of estate of bankruptcy
  • 137
     Completion of administration
  • 138
     Discharge order
  • 139
     Effect of discharge
  • 140
     Disqualification of bankrupt
  • 141
     Restrictions on bankrupt
  • 142
     Modification or recall of bankruptcy order
  • 143
     Standard of conduct
  • 144
     Fees of bankruptcy trustee
  • 145
     Replacement of bankruptcy trustee
  • 146
     Resignation by bankruptcy trustee
  • 147
     Vacancy in office of bankruptcy trustee
  • 148
     Release of bankruptcy trustee
  • CHAPTER V ADMINISTRATION AND DISTRIBUTION OF THE ESTATE OF THE BANKRUPT

  • 149
     Functions of bankruptcy trustee
  • 150
     Duties of bankrupt towards bankruptcy trustee
  • 151
     Rights of bankruptcy trustee
  • 152
     General powers of bankruptcy trustee
  • 153
     Approval of creditors for certain acts
  • 154
     Vesting of estate of bankrupt in bankruptcy trustee
  • 155
     Estate of bankrupt
  • 156
     Delivery of property and documents to bankruptcy trustee
  • 157
     Acquisition of control by bankruptcy trustee
  • 158
     Restrictions on disposition of property
  • 159
     After-acquired property of bankrupt
  • 160
     Onerous property of bankrupt
  • 161
     Notice to disclaim onerous property
  • 162
     Disclaimer of leaseholds
  • 163
     Challenge against disclaimed property
  • 164
     Undervalued transactions
  • 165
     Preference transactions
  • 166
     Effect of order
  • 167
     Extortionate credit transactions
  • 168
     Obligations under contracts
  • 169
     Continuance of proceedings on death of bankrupt
  • 170
     Administration of estate of deceased bankrupt
  • 171
     Proof of debt
  • 172
     Proof of debt by secured creditors
  • 173
     Mutual credit and set-off
  • 174
     Distribution of interim dividend
  • 175
     Distribution of property
  • 176
     Final dividend
  • 177
     Claims of creditors
  • 178
     Priority of payment of debts
  • CHAPTER VI ADJUDICATING AUTHORITY FOR INDIVIDUALS AND PARTNERSHIP FIRMS

  • 179
     Adjudicating authority for individuals and partnership firms
  • 180
     Civil court not to have jurisdiction
  • 181
     Appeal to Debt Recovery Appellate Tribunal
  • 182
     Appeal to Supreme Court
  • 183
     Expeditious disposal of applications
  • CHAPTER VII OFFENCES AND PENALTIES

  • 184
     Punishment for false information, etc., by creditor in insolvency resolution process
  • 185
     Punishment for contravention of provisions
  • 186
     Punishment for false information, concealment, etc., by bankrupt
  • 187
     Punishment for certain actions
  • CHAPTER I THE INSOLVENCY AND BANKRUPTCY BOARD OF INDIA

  • 188
     Establishment and incorporation of Board
  • 189
     Constitution of Board
  • 190
     Removal of member from office
  • 191
     Powers of Chairperson
  • 192
     Meetings of Board
  • 193
     Member not to participate in meetings in certain cases
  • 194
     Vacancies, etc., not to invalidate proceedings of Board, Officers and employees of Board
  • 195
     Power to designate financial sector regulator
  • CHAPTER II POWERS AND FUNCTIONS OF THE BOARD

  • 196
     Powers and functions of Board
  • 197
     Constitution of advisory committee, executive committee or other committee
  • 198
     Condonation of delay
  • CHAPTER III INSOLVENCY PROFESSIONAL AGENCIES

  • 199
     No person to function as insolvency professional agency without valid certificate of registration
  • 200
     Principles governing registration of insolvency professional agency
  • 201
     Registration of insolvency professional agency
  • 202
     Appeal to National Company Law Appellate Tribunal
  • 203
     Governing Board of insolvency professional agency
  • 204
     Functions of insolvency professional agencies
  • 205
     Insolvency professional agencies to make bye-laws
  • CHAPTER IV INSOLVENCY PROFESSIONALS

  • 206
     Enrolled and registered persons to act as insolvency professionals
  • 207
     Registration of insolvency professionals
  • 208
     Functions and obligations of insolvency professionals
  • CHAPTER V INFORMATION UTILITIES

  • 209
     No person to function as information utility without certificate of registration
  • 210
     Registration of information utility
  • 211
     Appeal to National Company Law Appellate Tribunal
  • 212
     Governing Board of information utility
  • 213
     Core services, etc., of information utilities
  • 214
     Obligations of information utility
  • 215
     Procedure for submission, etc., of financial information
  • 216
     Rights and obligations of persons submitting financial information
  • CHAPTER VI INSPECTION AND INVESTIGATION

  • 217
     Complaints against insolvency professional agency or its member or information utility
  • 218
     Investigation of insolvency professional agency or its member or information utility
  • 219
     Show cause notice to insolvency professional agency or its member or information utility
  • 220
     Appointment of disciplinary committee
  • CHAPTER VII FINANCE, ACCOUNTS AND AUDIT

  • 221
     Grants by Central Government
  • 222
     Board’s Fund
  • 223
     Accounts and audit
  • MISCELLANEOUS

  • 224
     Insolvency and Bankruptcy Fund
  • 225
     Power of Central Government to issue directions
  • 226
     Power of Central Government to supersede Board
  • 227
     Power of Central Government to notify financial service providers, etc
  • 228
     Budget
  • 229
     Annual report
  • 230
     Delegation
  • 231
     Bar of jurisdiction
  • 232
     Members, officers and employees of Board to the public servants
  • 233
     Protection of action taken in good faith
  • 234
     Agreements with foreign countries
  • 235
     Letter of request to a country outside India in certain cases
  • 235A
     Punishment where no specific penalty or punishment is provided
  • 236
     Trial of offences by Special Court
  • 237
     Appeal and revision
  • 238
     Provisions of this Code to override other laws
  • 238A
     Limitation
  • 239
     Power to make rules
  • 240
     Power to make regulations
  • 240A
     Application of this Code to micro, small and medium enterprises
  • 241
     Rules and regulations to be laid before Parliament
  • 242
     Power to remove difficulties
  • 243
     Repeal of certain enactments and savings
  • 244
     Transitional provisions
  • 245
     Amendments of Act 9 of 1932
  • 246
     Amendments of Act 1 of 1944
  • 247
     Amendments of Act 43 of 1961
  • 248
     Amendments of Act 52 of 1962
  • 249
     Amendments of Act 51 of 1993
  • 250
     Amendments of Act 32 of 1994
  • 251
     Amendments of Act 54 of 2002
  • 252
     Amendments of Act 1 of 2004
  • 253
     Amendments of Act 51 of 2007
  • 254
     Amendments of Act 6 of 2009
  • 255
     Amendments of Act 18 of 2013