The time limit for completion of the insolvency resolution process is laid down in Section 12 of Code.

A
period of one hundred eighty days from the date of admission of the application is given by Section 12(1)
of Code. This is extendable by a maximum period of ninety days only if the Committee of Creditors, by a
vote to extend the said period, and only if the Adjudicating Authority is satisfied that such process cannot
be completed within one hundred eighty days. The authority may then, by order, extend the duration of
such process by a maximum period of ninety days. Section 12(3) of Code which states that any extension
of the period under Section 12 of Code could not be granted more than once. This had to be read with the
third proviso to Section 30(4) of Code, which states that the maximum period of thirty days mentioned in
the second proviso is allowable as the only exception to the extension of the said period not being
granted more than once.

While Reg. 12(2) of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016
specifically provides that the creditors may submit their claims (even after expiry of last date fixed in the
public announcement) to the resolution professional till the approval of resolution plan by the CoC,
apparently there is no such explicit provision in case of liquidation (voluntary or compulsory), in the
Insolvency and Bankruptcy Code, 2016, IBBI (Voluntary Liquidation Process) Regulations, 2017 or IBBI
(Liquidation Process) Regulations, 2017. This is where the liquidator’s dilemma lies.

Thus, receipt of any such claim after last date of submission, the liquidator may reject the claim and
advise the creditor to seek directions against the liquidator, from the Adjudicating Authority to admit such
a claim. It is pertinent to note that there is a general remedy available to a creditor under Section 42 of the
Code, to appeal before the Adjudicating Authority, against the decision of a liquidator rejecting his claim
on any grounds which may also include rejection for late submission.

Held in Innoventive Industries Ltd. v. ICICI Bank and Anr. MANU/SC/1063/2017 : (2018) 1 SCC 407 at
paragraph 12. The Statement of Objects and Reasons, which is reproduced in the said paragraph, makes
it clear that the existing framework for insolvency and bankruptcy was not only inadequate and
ineffective, but resulted in undue delays in resolution. One of the primary objects of the Code,
therefore, is to resolve such matters in a time bound manner. This would not only support the
development of credit markets and encourage entrepreneurship, but would also improve ease of doing
business and facilitate more investment, leading to higher economic growth and development.