IBC Short Q & A.

Mumbai University
3 Years LLB- Semester IV (April 2023),
IBC
Questions & Answers complied by RK

Q1) Who shall be termed as Corporate Debtor?

Ans) As per Section 3(8) of the Code, Corporate Debtor means a
corporate person who owes a debt to any person.

Q2) What is Insolvency & Bankruptcy Code?

Ans) The Insolvency and Bankruptcy Code, 2016 (IBC) is the bankruptcy
law of India which seeks to consolidate the existing framework by creating
a single law for insolvency and bankruptcy.

Q3) What is the main objectives of IBC 2016?

The main objectives of IBC 2016 are
➢ To consolidate and amend the laws relating to reorganization and
insolvency resolution of corporate persons, partnership firms and
individuals in a time bound manner”.
➢ To provide for a time bound insolvency resolution mechanism;
➢ To ensure maximisation of value of assets
➢ To promote entrepreneurship;
➢ To increase availability of credit;
➢ To balance the interests of all the stakeholders including alteration in
the order of priority of payment of Government dues;
➢ To establish an Insolvency and Bankruptcy Board of India (IBBI) as a
regulatory body;
➢ To provide procedure for connected and incidental matters.

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Q4) What are the pillars of IBC Code 2016

Ans)The IB Code, 2016 provides for the establishment of a completely
new Institutional Framework for the smooth functioning of the Code. This
includes:
➢ Insolvency and Bankruptcy Board of India (IBBI),
➢ Adjudicating Authorities (AAs).
➢ Insolvency Professionals (IPs),
➢ Insolvency Professional Agencies (IPAs) and
➢ Information Utilities (IUs)

Q5) Who is governing body of IBC?

Ans) Insolvency and Bankruptcy Board of India (IBBI) is the governing
body of IBC.
Q6) Write a note on Insolvency and Bankruptcy Board of India (IBBI)?
➢ IBBI is an apex body governing Insolvency and Bankruptcy Code.
Functions of IBBI:
➢ It is a unique regulator which regulates a profession as well as processes
under the Code
➢ It aids in setting up the necessary infrastructure and accredits
Insolvency Professionals (IPs) and Information Utilities (IUs).
➢ It manages and controls Insolvency Professionals, Agencies and
Information Utilities set up under the IBC.
➢ It regulates all matters related to insolvency and bankruptcy process.
➢ Regulation making in specific areas about procedural details in the
insolvency and bankruptcy process & data collection, research and
performance evaluation.
➢ Setting out eligibility requirements of insolvency intermediaries i.e.,
Insolvency Professionals, Insolvency Professional Agencies and
Information Utilities.

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Composition of IBBI:
➢ The Board shall consist of the following members who shall be appointed
by the Central Government, namely:
➢ A Chairperson;
➢ Three members not below the rank of joint Secretary or equivalent,
one of each to represent the Ministry of Finance, the Ministry of
Corporate Affairs and Ministry of Law, ex-officio.
➢ One member to be nominated by the Reserve Bank of India, ex-officio.
➢ Five other members to be nominated by the Central Government, of
whom at least three shall be the whole-time members.

Q6) Who are the Insolvency Professionals (IP)/ Write Short note on IP?
➢ IPs are licensed professionals registered with IBBI who act as
Resolution Professional/ Liquidator/ Bankruptcy trustee in an insolvency
resolution process.
➢ They are a class of regulated but private professionals having minimum
standards of professional and ethical conduct
➢ It is a specialized category of professionals created to administer and
enforce the resolution process, manage the affairs of the corporate
debtor and share information with creditors to help them in decision-
making.
➢ Under the Act, a resolution professional has to be (a) member of any
Insolvency Professional Agency (IPA); (b) Be registered as an
Insolvency Professional with the IBBI.
➢ The main functions performed by IP are:
o corporate insolvency resolution process under Part II of IBC;
o liquidation of a corporate debtor firm under Part II;
o individual insolvency resolution process under Part III;
o Individual bankruptcy process under Part III;
o fresh start order process under Part III.

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Q7) Write a short note on insolvency Professional Agency?

➢ Section 3(20) of the IBC defines “insolvency professional agency” as
any person registered with the Board under section 201 as an insolvency
professional agency.
➢ Insolvency Professional Agencies are designated to regulate Insolvency
Professionals.
➢ Currently, there are 3 IPAs registered with the IBBI. They are (a)
ICSI Insolvency Professional Agency (b) Insolvency Professional Agency
of Institute of Cost Accountants of India. (c) Indian Institute of
Insolvency Professional of ICAI.
Functions of IPAs
➢ grant membership to persons who fulfil all requirements set out in its
byelaws on payment of membership fee
➢ lay down standards of professional conduct for its members
➢ monitor the performance of its members.
➢ safeguard the rights, privileges and interests of insolvency
professionals who are its members
➢ suspend or cancel the membership of insolvency professionals who are
its members on the grounds set out in its bye-laws
➢ redress the grievances of consumers against insolvency professionals
who are its members, and
➢ Publish information about its functions, list of its members,
performance of its members and such other information as may be
specified by regulations.

Q8) What is Committee of Creditors?

The Committee of Creditors (CoC) is constituted by the Interim Resolution
Professional (IRP) under section 21 of the Code, after the collation of all
the claims has been done. It is constituted of all the creditors who filed
their claims after the public announcement. It is mandatory to have all
financial creditors in the committee of creditors.

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The Committee of Creditors plays a crucial role throughout the CIRP and
decides whether the repayment of debt has to be done by liquidating the
assets of the corporate debtor or by the way of a resolution plan by the
resolution applicant.
This committee then appoints the Resolution Professional (RP) and it is the
RP who conducts and convenes all the meetings of the Committee.
Powers & functions of CoC:
➢ All important decisions are finalized after the approval from the
creditors of the committee of creditors.
➢ They decide about the continuation of interim resolution professional
as resolution professional or they can even decide to replace the interim
professional with a new resolution professional in first meeting of CoC.
➢ Committee of creditors are liable to decide about the restoration of
the corporate debtor by accepting the resolution plan.
➢ They are responsible for the evaluation and approval of the resolution
plan along with the modification, if any required.
➢ Once the committee of creditors is confident about the practicality and
viability of the proposed resolution plan, they can approve it with the
mandate of more than 66% of the vote
➢ They can choose to proceed ahead with the liquidation process of the
corporate debtor even without any approval on any resolution plan.
➢ They are empowered to exercise their commercial wisdom to take any
decision for the corporate debtor. This is implied on the committee of
creditors as they have a better knowledge on the subject and are
competent in addressing the serious situation of the company under
distress.

Q9) What is Fresh Start Process?

➢ The process of a fresh start is codified in Chapter II of Part III of
the code.

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➢ Fresh start process is a process wherein the eligible debtors (individual

and partnership firms) are discharged from certain debts which are
comparatively small and restart fresh with no liabilities
➢ The fresh start process has been conceptualized for persons who owe
relatively less amount of money and have little or no income or assets
to repay their debts.
➢ Once a person makes an application to the Adjudicating Authority and
the application gets accepted, they are discharged from the qualifying
debts and are not required to repay such debts.
➢ A “qualifying debt” means amount due, which includes interest or any
other sum due and does not include: (a) an excluded debt; (b) a debt
to the extent it is secured; and any debt which has been incurred 3
months prior to the date of the application for fresh start process.
➢ Excluded debt means (a) liability to pay fine imposed by a court or
tribunal; (b) liability to pay damages for negligence, nuisance or breach
of a statutory, contractual or other legal obligation; (c) liability to pay
maintenance to any person under any law; (d) liability in relation to a
student loan;(e) any other debt as may be prescribed.
Eligibility For Making An Application
➢ As per Section 80, a debtor who fulfills the following criteria is allowed
to file an application for initiation of a fresh start process: a) the
gross annual income of the debtor does not exceed Rs. 60,000; b) the
aggregate value of the assets of the debtor does not exceed Rs.
20,000; c) the aggregate value of the qualifying debts does not exceed
Rs. 35000; d) they are not undischarged bankrupts; e) they do not own
a dwelling unit, irrespective of whether it is encumbered or not; f) a
fresh start process, insolvency resolution process or bankruptcy process
is not subsisting against them; and g) no previous fresh start order had
been made in relation to them in the preceding 12 months of the date
of the application for fresh start.

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Process required to be followed once an application for initiation of the

fresh start process is filed:
➢ The first step is the appointment of a resolution professional who is
required to take the process forward.
➢ once the resolution professional is appointed, they are required to
examine the application within 10 days and submit a report to the DRT,
either recommending acceptance or rejection of the application along
with the reasons for such recomendations;
➢ Section 84 prescribes that the Adjudicating Authority shall make an
order either accepting or rejecting the application for initiation of a
fresh start process within 14 days of submission of report by the
resolution professional
➢ If the application is accepted, the moratorium period of 180 days shall
commence as against the debtor. The creditor cannot take a fresh
separate action against debtor in any other forum even the existing
legal actions in any other forum shall be halted.
➢ Creditors may file an objections, if any, with the resolution application
within a period of 10 days from the date of receipt of the order of
acceptance which shall be disposed off suitably by the RP within 10
days of receipt.
➢ Aggrieved party, which may be a debtor or a creditor can file an
application with Adjudicating authority against the decision of RP
➢ Based on the meetings with Debtor & Creditors, perusal of information
received from Debtors/Creditor, RP shall prepare a final list of
qualifying debts and submit such list to the Adjudicating Authority at
least 7 Days before the moratorium period comes to an end.
➢ On receiving the list and at the end of the moratorium period, the
Adjudicating Authority shall make an order discharging the debtor from
the qualified debts. The discharge order shall be forwarded to the
Board for the purpose of recording an entry in the register.

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Q10) What is the full form of NCLT and NCLAT?

Ans) NCLT- National Company Law Tribunal; NCLAT- National Company
Law Appellate Tribunal.

Q11) Write short note on NCLT & NCLAT?

National Company Law Tribunal (NCLT)
➢ National Company Law Tribunal (NCLT) is a body that was originally
established under Section 408 of Companies Act, 2013. However, it
also serves as an Adjudicating Authority under the IBC by virtue of
5(1) of the Act.
➢ It is a body having original Jurisdiction, and can take fresh matters
related to recovery and insolvencies. At present, it has 16 Benches
across India.
➢ NCLT has to work and follow procedures/guidelines as broadly defined
under The NCLT Rules, 2016.
National Company Law Appellate Tribunal (NCLAT)
➢ National Company Law Appellate Tribunal (NCLAT) is an appellate body
that was established under Section 410 of Companies Act, 2013. It
also serves as appellate authority for disputes under the IBC, and
hears appeals from the NCLT.
➢ Section 61 of the IBC provides that any person aggrieved by the order
of the Adjudicating Authority may prefer an appeal to the National
Company Law Appellate Tribunal.

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Q12) What is excluded debt?

➢ Excluded debt means (a) liability to pay fine imposed by a court or
tribunal; (b) liability to pay damages for negligence, nuisance or breach
of a statutory, contractual or other legal obligation; (c) liability to pay
maintenance to any person under any law; (d) liability in relation to a
student loan;(e) any other debt as may be prescribed

Q13) Short Note on Related party in relation to Corporate Debtor?

➢ “Related Party” in relation to a corporate debtor, means:
o a director or partner of the corporate debtor or their relative;
o a key managerial personnel of the corporate debtor or their
relative;
o an LLP or a partnership firm in which a director, partner, or
manager of the corporate debtor or his relative is a partner;
o a private company in which a director, partner or manager of the
corporate debtor is a director and holds along with his relatives,
more than 2% of its share capital;
o a public company in which a director, partner or manager of the
corporate debtor is a director and holds along with relatives,
more than 2% of its paid-up share capital;
o any body corporate whose board of directors, managing director
or manager, in the ordinary course of business, acts on the
advice, directions or instructions of a director, partner or
manager of the corporate debtor;
o any LLP or a partnership firm whose partners or employees in the
ordinary course of business, acts on the advice, directions or
instructions of a director, partner or manager of the corporate
debtor;

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o any person on whose advice, directions or instructions, a director,

partner or manager of the corporate debtor is accustomed to act;
o a holding, subsidiary or an associate company of the corporate
debtor, or a subsidiary of a holding company to which the
corporate debtor is a subsidiary;
o any person who controls more than 20% of voting rights in the
corporate debtor;
o any person in whom the corporate debtor controls more than 20%
of voting;
o any person who can control the composition of the board of
directors or corresponding governing body of the corporate
debtor;
o any person who is associated with the corporate debtor on account
of : (i) participation in policy making processes of the corporate
debtor; or (ii) having more than two directors in common between
the corporate debtor and such person; or (iii) interchange of
managerial personnel; or (iv) provision of essential technical
information to, or from, the corporate debtor [Section 5(24)].
23.

Q14) Define the term Financial Creditor?

Ans) “Financial Creditor” means any person to whom a financial debt is
owed and includes a person to whom such debt has been legally assigned
or transferred to.

Q15) Define the term operational creditor.

Ans) As per Section 5 (20) of the Code, “Operational Creditor” means a
person to whom an operational debt is owed and includes any person to
whom such debt has been legally assigned or transferred.

Q16) Who are financial creditor?

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Ans) A financial creditor is the one to whom the financial debt and the
interest is due, for example Home-buyers, banks, bond holders, guarantee
providers, financial institutions etc.

Q17) What is demand notice?

Ans) As per Section 8 of IBC, Demand notice means a notice served by
an operational creditor to the corporate debtor demanding payment of
the operational debt in respect of which the default has occurred.

Q 18) What is resolution plan?

➢ As per Section 5(26) of IBC, 2016 -“Resolution plan” means a plan
proposed by resolution applicant for insolvency resolution of the
corporate debtor as a going concern.
➢ In other words, a resolution plan is a proposal that aims to provide a
resolution to the problem of the corporate debtor’s insolvency and its
consequent inability to pay off debts.
➢ It needs to be approved by the committee of creditors (“COC”), and
comply with mandatory requirements prescribed in Insolvency and
Bankruptcy Code (IBC) 2016.

Q19) What is the meaning of Debt under the Code?

Ans) As per Section 3(11) of IBC, “debt” means a liability or obligation in
respect of a claim which is due from any person and includes a financial
debt and operational debt.

Q20) What is operational debt?

Ans) As per Section 5(21) of the IBC, “Operational Debt” means a claim
in respect of (a) provision of goods, or (b) provision of services including
employment, or (c) a debt in respect of the payment of dues arising under
any law for the time being in force and payable to the Central Government,
any State Government or any local authority.

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Q21) What are avoidance transactions?

➢ The IBC 2016 aims to maximise the value of a company’s assets and
secure the availability of assets for its creditors. As a company
nears insolvency, the promoters often try to strip away the assets
of the corporate debtor to minimise their own losses.
➢ Very often during the resolution process, it is seen that the company
has assets of negligible value and creditors are left in the lurch with
no recovery prospects.
➢ Under the Insolvency and Bankruptcy Code (IBC) 2016, avoidance
transactions are essentially transactions undertaken by the
corporate debtor prior to the initiation of the Corporate Insolvency
Resolution Process (CIRP) to defraud its creditors or to benefit
related parties as well as its own management.
➢ To protect lenders’ interests, the Code provides for avoidance of
preferential (Sections 43 and 44), undervalued (Section 45 to 48),
extortionate (Sections 50 and 51) and fraudulent (Section 49 and
66) transactions.
➢ Subject to certain exceptions, the IBC tries to invalidate the
transaction involves transfer of property or interest thereof given
during the relevant time to a person for the benefit of a creditor,
surety or guarantor on account of antecedent debt or other liabilities
which have the effect of putting such creditor, surety or guarantor
in a better positon which he would have been in if such transfer has
not been made.
Preferential Transaction:
➢ A transaction is described as a preferential transaction under
Section 43 of the IBC if it involves the transfer of the corporate
debtor's property or interest for the benefit of a creditor, surety,
or guarantor in relation to an antecedent or a past liability and if it
has the effect of giving such creditor, surety, or guarantor a

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beneficial position in the distribution of assets in the event of

liquidation under Section 53 of the Code.
➢ Furthermore, any such preferential transaction must have occurred
either within a "look back" period of two years immediately preceding
admission of the corporate debtor into insolvency in the case of a
transaction with a related party; and within a "look back" period of
one year immediately preceding admission of the corporate debtor
into insolvency in any other case.
➢ The transactions in the regular course of the corporate debtor's or
transferee's business or financial operations that result in the
production of new value for the corporate debtor are exempted,
even if they occur within the aforementioned look back periods.
Undervalued Transaction:
➢ A transaction is considered undervalued under section 45(2) of the
IBC if the corporate debtor makes a gift to a person or enters into
a transaction with a person that involves the corporate debtor in
transferring one or more assets for a consideration that is
significantly less than the value of the consideration provided by the
corporate debtor, and the transaction is not in the corporate
debtor's ordinary course of business.
➢ The undervalued transactions have same look back time as applicable
to preferential transactions.
Transactions Defrauding Creditors
➢ The provisions of transactions defrauding creditors related are
addressed in section 49 of the IBC. This section discusses
transactions made by a corporate debtor with the intent of putting
the corporate debtor's assets beyond the reach of creditors or
otherwise prejudicing the interests of the person making a claim
against the corporate debtor or who may make a claim against the
corporate debtor in the near future. The unique feature of section
49 when looked upon is that there is no time limit for contesting the

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transaction before the Tribunal, unlike the other avoidable

transactions, which have a one-year time limit for individuals and a
two-year time limit for connected parties.
➢ Purposeful conduct on the part of the corporate debtor to enter into
an undervalue transaction is a key need for attracting section 49.
This transaction was made with the objective of keeping the
corporate debtor's assets out of the hands of anyone who might be
able to bring a claim against it or who might harm the corporate
debtor's interests. And, if a Resolution professional or liquidator
notices this type of transaction, he can file a complaint with the
adjudicating authority, which, if satisfied, would issue an order
restoring the situation to the way it was before the transaction,
and make it as if the transaction never happened, by protecting the
interests of those who are victims of such transactions as well.
➢ After analyzing the provisions, it is essential to understand that
both section 45 and section 49 deal with avoidance transactions but
the main distinction is that section 49 is concerned with undervalued
transactions carried out with malafide or unlawful purpose and no
such element is required under section 45. Likewise, section 45 has
a look back period, but section 49 does not, because once fraud is
committed, it is committed forever. The rationale behind the clause
is that anyone who has committed a criminal act with malice in mind
cannot get away with it by invoking a justification like the passage
of time
Extortionate Transactions
➢ An extortionate transaction is defined as the receipt of financial or
operational debt within two years after the insolvency beginning date
at terms requiring the corporate debtor to make extravagant
payments, which may be avoided by an order of the adjudicating
authority under Section 50 of the IBC.

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➢ The credit obtained by the corporation at unreasonably high-interest

rates is an example of an extortionate credit transaction and the
NCLT, New Delhi bench judged the agreed rate of interest of 65 %
p.a to be an extortionate transaction in the case of Shinhan Bank
v. Sugnil India Private Limited and others

Q22) What is financial debt?

➢ “Financial Debt” means a debt along with interest, if any, and includes:
o money borrowed against the payment of interest;
o any amount raised by acceptance under any acceptance credit
facility or its de-materialised equivalent;
o any amount raised pursuant to the issue of bonds, notes,
debentures, loan stock or any similar instrument;
o the amount of any liability in respect of any lease or hire purchase
contract;
o receivables sold or discounted other than any receivables sold on
nonrecourse basis;
o any amount raised under any other transaction, including any
forward sale or purchase agreement, having the commercial
effect of a borrowing;

Q23) What is default under IBC?

Ans) As per IBC, “default” means “non-payment of debt when whole or
any part or instalment of the amount of the debt has become due and
payable and is not repaid by the debtor or the corporate debtor, as the
case may be.”
It must be noted that for the purposes of Section 7(1)(8) of the IBC,
default includes a default in respect of the financial debt owed not only
to the applicant financial creditor but to any other financial creditor of
the corporate debtor.

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Q24) What is fast track corporate insolvency resolution process?

Ans) A fasttrack corporate insolvency resolution, as the name suggests,
is a process wherein the insolvency resolution process shall be completed
within a period of ninety days from the insolvency commencement date.

Q25) Name any two key roles of an Interim Resolution Professional (IRP)?
Ans. The key roles of an Interim Resolution Professional are:-
(a) Issuance of public notice of the Corporate Insolvency Resolution
process.
(b) To take custody and control of all assets of the corporate debtor.
(c) To call for claims and collation of claims received.
(d) Constitution of the Committee of Creditors (CoC) and to conduct 1st
meeting of CoC.

Q 26) Name any two Duties of Resolution Professional (RP)?

Ans) As per Section 25 of IBC, following are the duties of the Resolution
Professional:
a) to preserve and protect the assets of the corporate debtor, including
the continued business operations of the corporate debtor.
b) Represent and act on behalf of the corporate debtor with third parties,
exercise rights for the benefit of the corporate debtor in judicial,
quasi-judicial or arbitration proceedings
c) convene and attend all meetings of the committee of creditors.

Q27) What is insolvency?

Ans) Insolvency is a state where the liabilities of an individual or an
organization exceeds its asset and that entity is unable to raise enough
cash to meet its obligations or debts as they become due for payment.

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Q28) What is bankruptcy?

Ans) Bankruptcy is when a person or company is legally declared incapable
of paying their due and payable bills.

Q 29) Insolvency V/s bankruptcy?

Ans) Insolvency is a state where the liabilities of an individual or an
organization exceeds its asset and that entity is unable to raise enough
cash to meet its obligations or debts as they become due for payment.
Bankruptcy is when a person or company is legally declared incapable of
paying their due and payable bills
Insolvency is not the same as bankruptcy. Insolvency is a state of
economic distress, whereas bankruptcy is a court order that decides how
an insolvent debtor will deal with unpaid obligations.

Q30) What is the meaning of moratorium under IBC?

Ans) Moratorium is a period wherein no judicial proceedings for recovery,
enforcement of security interest, sale or transfer of assets, or
termination of essential contracts can be instituted or continued against
the Corporate Debtor.

Q 31) Who is Resolution Applicant?

Ans) Resolution Applicant defined under section 5(25) of IBC as “a person
who submits a resolution plan to Insolvency Resolution Professional (IRP)”.
A resolution plan specifies the details of how the debt of a defaulting
debtor can be restructured.

Q32) Within how many days Interim Resolution Professional (IRP) are
required to be appointed?
Ans) The adjudicating authority (NCLT) shall appoint an IRP within 14
days from the insolvency commencement date.

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Q 33) Who are Adjudicating Authority under IBC?

Ans) Adjudicating Authorities (AA) have the exclusive jurisdiction to deal
with insolvency related matters.
National Company Law Tribunal (NCLT) is the AA for Corporate and LLP
insolvency.
Debt Recovery Tribunal (DRT) would be AA for individual or partnership
Firms Insolvency.

Q34) To whom the provisions of IBC are applicable?

Ans) IBC is applicable to (i) Company; (ii) Limited Liability Partnership;
(iii) An individual; (iv) A Hindu Undivided Family; (v) A Partnership (vi) A
Trust (vii) Any other entity established under a statute, and includes a
person resident outside the India.

Q35 ) What is the limitation period for making application under IBC?
Ans) As per article 137 of limitation Act, the right to sue”, accrues when
a default occurs. If the default has occurred over three years prior to
the date of filing of the application, the application would be barred under
Article 137 of the Limitation Act. Thus the limitation period is 3 years
from the date of default for filing application under IBC.

Q36) Who can initiate insolvency resolution process?

Ans) Where any Corporate Debtor commits a default, a Financial Creditor
u/s 7, Operational Creditor u/s 8 or the Corporate Applicant u/s 10 of
the Code itself may initiate corporate insolvency resolution process.

Q37) Within what time CIRP should be completed?

Ans) CIRP must be completed within 180 days from ‘insolvency
commencement date’. If the Adjudicating Authority is satisfied that CIRP
cannot be completed within 180 days, then it may grant extension upto
90 days.

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Q38) What is the order for distribution of proceeds from liquidation in

IBC?
Proceeds from the sale of the debtor’s assets are distributed in the
following order of precedence: i) Insolvency resolution costs, including the
remuneration to the insolvency professional, ii) Secured creditors, whose
loans are backed by collateral, dues to workers, other employees (upto 12
months), iii) Unsecured creditors; iv) Dues to government (upto 2 years),
v) Priority shareholders vi) Equity shareholders.

Q39) What is Liquidation Estate?

➢ The concept of Liquidation estate has been envisaged under Section 36
of the Code, 2016.
➢ Liquidation Estate refers to the Estate of those properties of the
corporate debtor which are available with the liquidator to be realized
in order to discharge its debts. This Estate is held by the Liquidator
on behalf of the corporate debtor in fiduciary capacity for the benefit
of all the creditors.
➢ Liquidation estate should comprise of the following assets:
➢ assets over which the corporate debtor has ownership rights, as
evidenced in the balance sheet of the corporate debtor or an
information utility or records in the registry or any
➢ depository recording securities of the corporate debtor or by any other
means as may be specified by the Board, including shares held in any
subsidiary of the corporate debtor
➢ assets that may or may not be in possession of the corporate debtor
including but not limited to encumbered assets
➢ tangible assets, whether movable or immovable
➢ intangible assets including but not limited to intellectual property,
securities and financial instruments, insurance policies, contractual
rights;

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➢ assets subject to the determination of ownership by the court or

authority;
➢ assets or their value recovered through proceedings for avoidance of
transactions in accordance with this Chapter
➢ Those assets of the corporate debtor in respect of which a secured
creditor has relinquished security interest
➢ any other property belonging to or vested in the corporate debtor at
the insolvency commencement date; and
➢ all proceeds of liquidation as and when they are realised.

Q) What is Fast Track CIRP?

➢ The procedure pertaining to the fast track insolvency of small-scale
enterprises is enshrined under Ss. 55 to 58 of the Insolvency and
Bankruptcy Code, 2016 & the Insolvency and Bankruptcy Board of India
(Fast track Insolvency Resolution Process for Corporate Persons)
Regulations, 2017.
➢ Application for initiation of Corporate Insolvency Process can be made
only against these below-mentioned corporate debtors:
a) Small-sized Companies (As defined under the Companies Act, 2013).
b) Start-up Company other than a Partnership Firm.
c) An Unlisted Company with total assets less than one crore rupees
(as reported in the books of the preceding financial year).
➢ Fast track CIRP proceedings aim to eliminate the excess delay which is
caused due to the insolvency process of a small-scale company.
➢ The time period for the completion of the fast track insolvency as
incorporated under the provisions of the Code of 2016 is ninety (90)
days. This time period can be further extended for a period of forty-
five (45) days. This extension can be granted only once.
➢

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