IIRP - IIIPI Best Practices

Best Practices on
Individual Insolvency under IBC, 2016

(with Reference to PG to CD)
Study By
Indian Institute of Insolvency Professionals of ICAI (IIIPI)
Best Practices
on Individual Insolvency under IBC, 2016
Study By

NEW DELHI
Best Practices on Individual Insolvency under IBC, 2016
Published By:
ICAI Bhawan, P. O. Box No. 7100, Indraprastha Marg, New Delhi - 110002
Website : www.iiipicai.in
Published in: November 2022
Printed By:
Perfact Impression Pvt. Ltd.,
49/72, Sahibabad Industrial Area, Site-IV, Ghaziabad, Uttar Pradesh - 201010
Copyright © Indian Institute of Insolvency Professionals of ICAI (IIIPI)
Email: iiipi.pub@icai.in
Disclaimer:
The views and opinions expressed or implied in this report are those of professional members
and do not necessarily reflect those of IIIPI. IIIPI is not in any way responsible for the result of
any action taken on the basis of views and opinions expressed herein. Material in this report
shall not be reproduced, whether in part or in whole, without the written consent of IIIPI.
Foreword
The Indian Institute of Insolvency Professionals of ICAI (IIIPI) is pleased to present
the report on Best Practices on Individual Insolvency (with Reference to PG to CD)
under IBC 2016 prepared by the Study Group constituted by IIIPI in this regard.
This publication was released by Sh. Ravi Mital, Chairperson, IBBI on the occasion
of 6th Annual Day Program organized by the IIIPI on 25th November 2022.
The purpose of this publication is to provide guidance to IPs while discharging their
roles and responsibilities in respect of individual insolvency resolution process and
be market-ready before the full-fledged individual insolvency framework comes on
stream. The guidance in this document is based on best practices, nationally and
internationally, and are directory in nature. We hope that these guidelines will help
the IPs in execution of their responsibilities in the context of individual insolvency
resolution process, transparently and independently within the scope of law and
regulations as envisaged under IBC.
I sincerely appreciate and thank CA. G. Ramaswamy, IP for steering the Study
Group and providing his valuable guidance, along with members of the group who
all worked hard to prepare the draft report.
I also appreciate the efforts put in by CA. Rahul Madan, Managing Director, and
the Research Department of IIIPI for providing their technical and administrative
support in bringing out this publication.
Further, after gaining more experience, this Background Guidance Note shall be
reviewed from time to time. I am sure that the professional members of IIIPI and
other stakeholders of IBC will find this publication immensely helpful.
Date: November 25th 2022 Dr. Ashok Haldia,

Place: New Delhi Chairman, IIIPI-Governing Board
Best Practices on Individual Insolvency under IBC, 2016 iii www.iiipicai.in

Preface
The Study Group constituted by the Indian Institute of Insolvency Professionals

of ICAI (IIIPI) on” Best Practices on Individual Insolvency (with reference to PG to
CD)” under IBC 2016 is pleased to present this report.
The Study Group was given a mandate to deliberate and recommend on best practices
to be followed by IPs while carrying out their responsibilities in connection with
Individual Insolvency Process (with reference to PG to CD) within the framework of
IBC. The study group, consisting of members having rich experience in in managing
insolvency and bankruptcy, has attempted to develop a comprehensive document
on the subject after wider consultation intra-group and with other stakeholders.
This report has been created with the objective of furthering transparency and
equipping the IPs to execute their roles and responsibilities with respect to individual
insolvency, more effectively. This report shall provide a framework to IPs on
matters like identifying the common and divergent practices in Individual insolvency
as compared with CIRP, grey areas and best practices across the resolution and
bankruptcy process, effective coordination, and jurisdiction between connected
CIRP and Individual Insolvency resolution, etc.
The study group is thankful to Dr. Ashok Haldia, Chairman, IIIPI for providing an
opportunity to develop the knowhow as above and providing his insights. The group
is particularly thankful to CA..M. Suresh Kumar, IP for his efforts in creating the
initial draft of the report. In addition, the group expresses gratitude to several other
professionals including experienced IPs, legal experts and other professionals who
have contributed directly and indirectly to the development of this report on ‘Best
Practices on Individual Insolvency (with reference to PG to CD) under IBC’.
CA G. Ramaswamy, IP (Chairman)
M. Suresh Kumar IP Durgesh Kabra, IP P. K. Diwakar, IP

G. Gunasekaran, IP N. Sivachalam, IP S. Prabhu, IP
S. Kasi Viswanathan, IP R. Raghavendran, IP R. Shanmuggam, IP
N. Venkatesh, IP A.V. Arun, IP Anju Agarwal, IP
R. Balachandran, IP Nipun Singhvi, IP KV Jain, IP
Navneet Gupta, IP Pradeep Kabra, IP Pulkit Gupta. IP
Date: November 25th, 2022

Place: New Delhi
Best Practices on Individual Insolvency under IBC, 2016 v www.iiipicai.in

Contents
1. Abbreviations 1
2. Background 3
3. Legal Provisions 5
Overall structure of Code 5
Organisation of Sections of Part III 5
Related Rules & Regulations [notified upto 30.06.2022] 8
Adjudicating & Appellate Authority 9
4. Overall Flow of the Individual Insolvency Resolution Process 10
6. Relevant Legal Extracts – “Guarantee” / “Guarantors” 12
7. Key Case Laws 15
8. Difference Between Corporate Insolvency & Individual Insolvency’s 20
9. Difference Between Corporate Liquidation & Individual Bankruptcy 21
10. Role of RP’s During Initiation of Individual Insolvency Resolution

Process & Preparation of RP Report 23
11. Role of RP’s During Claim Processing / Admission / List of Creditors 33
12. Role of RP’s During Repayment Plan & Meeting Creditors for the
Approval/Consideration of the Repayment Plan 36
13. Role of RP’s During Implementation of Resolution Plan 48
14. List of Exceptional Scenarios & Suggested Sop’s 53
15. Appendices 59
Best Practices on Individual Insolvency under IBC, 2016 vii www.iiipicai.in

Abbreviations
AA Adjudicating Authority
CD Corporate Debtor
CIRP Corporate Insolvency Resolution Process
DRT Debt Recovery Tribunal
DRAT Debt Recovery Appellate Tribunal
HC High Court
IBBI Insolvency and Bankruptcy Board of India
IBC / Code Insolvency and Bankruptcy Code 2016
ICA Indian Contract Act, 1872
ICAI Institute of Chartered Accountants of India
IIIP-ICAI Indian Institute of Insolvency Professionals of ICAI
IP Insolvency Professional
IPA Insolvency Professional Agency
IRP Interim Resolution Professional
NCLT National Company Law Tribunal
NCLAT National Company Law Appellate Tribunal
PG Personal Guarantor
RP Resolution Professional
SC Supreme Court
Best Practices on Individual Insolvency under IBC, 2016 1 www.iiipicai.in

Background
Over last five years, since inception of IBC, jurisprudence has evolved and is still
evolving as a significant economic legislation for reorganizing and resolving distressed
businesses. IBC, as an effective deterrent, has successfully altered the behaviour of
lenders and borrowers.
After the prepack insolvency framework recently introduced, it is expected that individual
insolvency framework in its full-fledged form may become reality soon in India, after the
framework for personal guarantors to CDs, was made effective from Dec, 2019. In fact,
framework of such Individual Insolvency including partnership firms, is touted to be next
big thing, for Indian IBC regime.
The momentum of PG to CD framework was halted due to various writ petitions in High
Courts. Finally, Hon’ble SC judgement came in the case of SBI Vs. Anil D. Ambani
in May’2021, which settled jurisprudence in respect of constitutional validity of the
framework for PG to CD and clarifying some of the other aspects.
PG to CD framework has been in vogue for over two years now. Over 650 cases have
been initiated. There are many dissimilarities, complexities and legal interpretations of
provisions, in PG to CD cases as compared with CIRP and hence the need to develop
a best practice document for guidance of IPs. The best practice document as proposed
shall also help professionals and stakeholders, prepare in advance and be market-
ready before the full individual insolvency framework comes on stream.
In view of above, IIIP-ICAI proposes to constitute a study group to develop the best
practice document on Individual Insolvency with specific reference to PG to CD
framework. Once the draft of this best practice document is prepared, IBBI and other
IPAs shall also be consulted before releasing the formal best practice document for the
benefit of all IPs.
Though the Study Group (in its first meeting) can deliberate on contents/structure of
study, our initial thoughts on likely structure/headings, for examining issues/grey-areas
and recommending best practices thereon, are as follows:
• Identifying common and divergent practices in an Individual insolvency

Resolution (PG to CD) Vs. CIRP, for better understanding.
• Jurisdiction and coordination between connected CIRP and Individual
Insolvency Resolution (PG to CD)
• Other grey areas and best practices across the resolution and bankruptcy
processes.
• Best practices can be supported by citing Case Laws especially from Hon’ble
Supreme Court and NCLAT.

Background
Members of Study Group:
• CA G. Ramaswamy, IP (Chairman)
• CA. Durgesh Kabra, IP
• CA M. Suresh Kumar, IP
• CA P. K. Diwakar, IP
• CA. G. Gunasekaran, IP
• CA. N. Sivachalam, IP
• CA. S. Prabhu, IP
• CA. S. Kasi Viswanathan, IP
• CA. R. Raghavendran, IP
• CA R. Shanmuggam, IP
• CA N. Venkatesh, IP
• CA A.V. Arun, IP
• Ms. Anju Agarwal, IP
• CA R. Balachandran, IP
• CA Nipun Singhvi, IP
• CA KV Jain, IP
• CA Navneet Gupta, IP
• CA. Pradeep Kabra, IP
• CA. Pulkit Gupta. IP

Legal Provisions
The act enacted in 2016 has underwent robust changes in the last 5 years considering
the evolving jurisprudence in the corporate insolvency. The individual insolvency is just
started in limited way, which needs to undergo many vagaries in the coming days. To
start with, lets understand the brief structure of the code:
Overall structure of Code

• In the Part III, the Chapter II is yet to be notified.
• Section 78-79 & Section 94-187 are notified w.e.f 01.12.2019 only in so far as
they relate to personal guarantors to corporate debtors.
Organisation of Sections of Part III

Section Minor Heading
Chapter-I [Preliminary]
78 Application
79 Definitions.
Chapter-II [Fresh Start Process] – {Not notified – Section 80-93}
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 Resistering 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.

Legal Provisions
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 bankrupt.
137 Completion of administration.
138 Discharge order.
139 Effect of discharge.

Legal Provisions
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.
160 After-acquired property of bankrupt.
161 Onerous property of bankrupt.
162 Notice to disclaim onerous property.
163 Disclaimer of leaseholds.
164 Challenge against disclaimed property.
165 Undervalued transactions.
166 Preference transactions.
167 Effect of order.
168 Extortionate credit transactions.
169 Obligations under contracts.
170 Continuance of proceedings on death of bankrupt.
171 Administration of estate of deceased bankrupt.

Legal Provisions
172 Proof of debt.

173 Proof of debt by secured creditors.
174 Mutual credit and set-off.
175 Distribution of interim dividend.
176 Distribution of property.
177 Final dividend.
178 Claims of creditors.
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]
Punishment For False Information, Etc., By Creditor In Insolvency
184
Resolution Process.
185 Punishment For Contravention Of Provisions.
186 Punishment For False Information, Concealment, Etc., By Bankrupt.
187 Punishment For Certain Actions.
Related Rules & Regulations [Updated Upto 30.06.2022]

Upon notification of the relevant provision of the individual insolvency, the government
has notified the following rules and regulations w.e.f 01.12.2019:
Rules
1. The Insolvency and Bankruptcy (Application to Adjudicating Authority

for Insolvency Resolution Process for Personal Guarantors to Corporate
Debtors) Rules, 2019
2. The Insolvency and Bankruptcy (Application to Adjudicating Authority

for Bankruptcy Process for Personal Guarantors to Corporate Debtors)
Rules, 2019

Legal Provisions
Regulations
1. The Insolvency and Bankruptcy Board of India (Insolvency Resolution

Process for Personal Guarantors to Corporate Debtors) Regulations,
2019
2. The Insolvency and Bankruptcy Board of India (Bankruptcy Process for

Personal Guarantors to Corporate Debtors) Regulations, 2019
Adjudicating & Appellate Authority

Adjudicating Authority National Company Law Tribunal (NCLT) – Section 60*
Debt Recovery Tribunal (DRT) - Section 179

Appellate Authority National Company Law Appellate Tribunal (NCLAT) –
Section 61*
Debt Recovery Appellate Tribunal (DRAT) -Section 181
Section 60 Sub-section (2), (3) & (4)
(2) Without prejudice to sub-section (1) and notwithstanding anything to the contrary
contained in this Code, where a corporate insolvency resolution process or liquidation
proceeding of a corporate debtor is pending before a National Company Law Tribunal,
an application relating to the insolvency resolution or liquidation or bankruptcy of a
corporate guarantor or personal guarantor, as the case may be, of such corporate
debtor shall be filed before such National Company Law Tribunal.
(3) An insolvency resolution process or liquidation or bankruptcy proceeding of a

corporate guarantor or personal guarantor, as the case may be, of the corporate
debtor pending in any court or tribunal shall stand transferred to the Adjudicating
Authority dealing with insolvency resolution process or liquidation proceeding of such
corporate debtor.
(4) The National Company Law Tribunal shall be vested with all the powers of the
Debt Recovery Tribunal as contemplated under Part III of this Code for the purpose
of sub-section (2).
* Note: Refer - State Bank of India, SAMB v. Mahendra Kumar Jajodia judgement [(2022) ibclaw.in 89 NCLAT
– Appeal against this order before SC was dismissed)

Overall Flow of the Individual Insolvency
Resolution Process
Individual Insolvency Resolution Process
• In the Part III, the Chapter II is yet to be notified.

• Section 78-79 & Section 94-187 are notified w.e.f 01.12.2019 only in so far as
they relate to personal guarantors to corporate debtors.
Incase of Breach of Repayment Plan

Overall Flow of the Individual Insolvency Resolution Process
Bankruptcy Process:
Appointment of Bankruptcy Trustee

Relevant Legal Extracts –
“Guarantee” / “Guarantors”
Guarantee:
General Definition Guarantee is a promise by one person, who is called the

‘guarantor’ or ‘surety’ to answer for the present or future
debt of another person who is called the ‘principal debtor’,
such promise being made to the party to whom the principal
debtor is, or will become, liable.
Section 126 of ICA, ‘Contract of guarantee’, ‘surety’, ‘principal debtor’ and
1872 ‘creditor’
A ‘contract of guarantee’ is a contract to perform the promise,

or discharge the liability, of a third person in case of his
default.
The person who gives the guarantee is called the ‘surety’;
The person in respect of whose default the guarantee is

given is called the ‘principal debtor’, and the person to whom
the guarantee is given is called the ‘creditor’.
Mere omission of sign on the agreement cannot absolve him from his liability as the
guarantor:
• P.J. Rajappan v Associated Industries (P) Ltd. [2017] ibclaw.in 16 SC

• Mathura Das vs. Secretary of State, Allahabad High Court
Invalid Guarantees:
Section 142 Any guarantee which has been obtained by means

[ICA]- Obtained by of misrepresentation made by the creditor, or with his
misrepresentation knowledge and assent, concerning a material part of the
transaction, is invalid.
Section 143 [ICA]- Any guarantee which the creditor has obtained by means
Obtained by concealment of keeping silence as to material circumstances, is invalid.
Section 144 [ICA]- Invalid As per section 144, where a person gives a guarantee
if that other person does upon a contract that the creditor shall not act upon it until
not join another person has joined in it as co-surety, the guarantee
is not valid if that other person does not join.

Relevant Legal Extracts – “Guarantee” / “Guarantors”
Surety Liability:
Section 128 [ICA]- Surety’s The liability of the surety is co- extensive with that of
liability the principal debtor, unless it is otherwise provided by
the contract.
Maharashtra State The fact that the company which is the principal debtor
Electricity Board [2017] – has gone into liquidation would not have any effect on
Supreme Court the liability of the guarantor.
S. Chattanatha Karayalar If a transaction is contained in more than one document

vs. Central Bank of India between the same parties, they must be read and
Ltd. [2017] – Supreme interpreted together. Although a guarantor may join the
Court principal debtor in executing the promissory note he will
not be a co-obligant where the underlying transaction
and the conduct of the parties show that he is a surety
under Section 126 of the Contract Act
Discharge of Surety:
Section 133 [ICA]- Any variance, made without the surety‟s consent, in the
Discharge of surety by terms of the contract between the principal debtor and
variance in terms of contract the creditor, discharges the surety as to transactions
subsequent to the variance
Section 134 [ICA]- The surety is discharged by any contract between
Discharge of surety by the creditor and the principal debtor, by which the
release or discharge of principal debtor is released, or by any act or omission
principal debtor of the creditor, the legal consequence of which is the
discharge of the principal debtor.
Section 135 [ICA]- A contract between the creditor and the principal
Discharge of surety when debtor, by which the creditor makes a composition with,
creditor compounds with, or promises to give time to, or not to sue, the principal
gives time to, or agrees not debtor, discharges the surety, unless the surety assents
to sue, principal debtor to such contract.
Section 136 [ICA]- Surety Where a contract to give time to the principal debtor is
not discharged when made by the creditor with a third person, and not with
agreement made with the principal debtor, the surety is not discharged.
third person to give time to
principal debtor
Section 137 [ICA]- Creditor’s Mere forbearance on the part of the creditor to sue the
forbearance to sue does not principal debtor or to enforce any other remedy against
discharge surety him does not, in the absence of any provision in the
guarantee to the contrary, discharge the surety.

Relevant Legal Extracts – “Guarantee” / “Guarantors”
Section 138 [ICA]- Release Where there are co-sureties, a release by the creditor
of one co-surety does not of one of them does not discharge the others; neither
discharge others does it free the surety so released from his responsibility
to the other sureties
Section 139 [ICA]- If the creditor does any act which is inconsistent with
Discharge of surety by the rights of the surety, or omits to do any act which his
creditor’s act or omission duty to the surety requires him to do, and the eventual
impairing surety’s eventual remedy of the surety himself against the principal
remedy debtor is thereby impaired, the surety is discharged.

Key Case Laws
State Bank of India Section 95, read with section 60, of the Insolvency and
Bankruptcy Code, 2016 –
v.
Individual/firm’s insolvency resolution process - Application
Mahendra Kumar by creditor - Appellant/financial creditor filed an application
Jajodia under section 95(1) for initiating Insolvency Resolution
Process (CIRP) against personal guarantor:
[2022] 136 taxmann.
com 371 (NCL-AT) Whether object of section 60(2) was that when a CIRP or
liquidation proceedings of corporate debtor is pending before
a NCLT, application relating to insolvency process of a
guarantor should be filed before same NCLT and it does not
in any way prohibit filing of proceedings under section 95 if no
proceedings against corporate debtor were pending before
NCLT - Held, yes
Whether, thus application filed by financial creditor was fully
maintainable and could not be rejected on ground that no
CIRP or liquidation proceedings of corporate debtor was
pending before NCLT - Held, yes
Lalit Kumar Jain Section 2, read with sections 1, 78, 79, 94 to 187, 239 and
249, of the Insolvency and Bankruptcy Code, 2016
v.
Application of Code - Petitioners were associated with
Union Of India different corporate debtor companies as directors, promoters
or in some instances, as chairman or managing directors -
[2021] 127 taxmann. They furnished personal guarantees to banks and financial
com 368 (SC) institutions - Notification No. S.O. 4126 (E), dated 15-11-2019
was issued by Central Government which brought into force
sections 2(e), 78, 79, 94-187, 239(2)(g), 239(2)(h) & 239(2)
(i), 239(2)(m) to 239(2)(zc), 239(2)(zn) to 239(2)(zs) and 249
in relation to such ‘personal guarantors to corporate debtors’
Whether there is no compulsion in Code that it should, at
same time, be made applicable to all individuals, (including
personal guarantors) and there is sufficient indication in Code
by sections 2(e), 5(22), sections 60 and 179 indicating that
personal guarantors, though forming part of larger grouping
of individuals, are to be, in view of their intrinsic connection
with corporate debtors, dealt with differently, through same
adjudicatory process and by same forum as such corporate
debtors - Held, yes
Whether further, impugned notification, has merely made
provisions of Code applicable in respect of ‘personal
guarantors to corporate debtors’ as another such category of
persons to whom Code has been extended - Held, yes

Key Case Laws
Whether, thus, impugned notification is not an instance

of legislative exercise, or amounting to impermissible and
selective application of provisions of Code and it being issued
within power granted by Parliament, is valid - Held, yes
Section 31, read with sections 1 and 2 of the Insolvency and
Bankruptcy Code, 2016, and sections 128, 133 and 140 of
the Contract Act, 1872
Corporate insolvency resolution process - Resolution plan -
Approval of
Whether approval of a resolution plan does not ipso facto
discharge a personal guarantor (of a corporate debtor) of her
or his liabilities under contract of guarantee - Held, yes
Whether release or discharge of a principal borrower from
debt owed by it to its creditor by an involuntary process, i.e. by
operation of law, or due to liquidation or insolvency proceeding,
does not absolve surety/guarantor of his/her liability which
arises out of an independent contract - Held, yes
Whether approval of resolution plan relating to corporate debtor
does not discharge liabilities of personal guarantors - Held, yes
Ravi Ajit Kulkarni Section 95, read with sections 96 and 99, of the Insolvency
and Bankruptcy Code, 2016 read with rules 11 and 44 of the
v. National Company Law Tribunal Rules, 2016
State Bank of India Individual/firm’s insolvency resolution process - Application
by creditor:
[2021] 130 taxmann.
com 442 (NCL-AT) Whether once application under section 95 is filed,
Adjudicating Authority has to act on it, and following principle
of natural justice, it has to give limited notice to debtor/
personal guarantor - Held, yes
Whether limited notice has to be only to secure presence of
debtor/personal guarantor referring to Interim Moratorium
which has commenced so that when Resolution Professional
is appointed, they may provide material in their favour as per
section 99(2) - Held, yes
Whether before appointment of Resolution Professional,
debtor is not allowed to raise disputes, however, if debtor
raises dispute on merit, same may be adjudicated only after
receipt of report from Resolution Professional under section
99 - Held, yes
Whether stage for considering default arrives when matter is
taken up under section 100 - Held, yes

Key Case Laws
L. Ramalakshmamma Section 97 of the Insolvency and Bankruptcy Code, 2016,

read with rule 8 of the Insolvency and Bankruptcy (Application
v. to ‘Adjudicating Authority’ for Insolvency Resolution Process
State Bank of India for Personal Guarantors to Corporate Debtors) Rules, 2019
Individual/firm’s insolvency resolution process - Resolution
[2021] 133 taxmann. professional, appointment of - ‘Adjudicating Authority’ had
com 342 (NCLAT - passed ‘Impugned Orders’ whereby and whereunder he had
Chennai) appointed an ‘Interim Resolution Professional’ - Appellants
submitted that ‘Impugned Orders’ were cryptic, unreasoned,
non est and non-speaking orders which were passed in violation
of ingredients of IBC as ‘Adjudicating Authority’ by ‘Impugned
Orders’ had appointed ‘IRP’ without adhering to mandatory
section 97 - However, on going through word ‘shall’ employed
in section 97(1), it is viewed that it is only ‘Directory’ and not
‘Mandatory’ and NCLT may pick up any one for appointment
of ‘IRP’ - Moreover, if viewed from object and purpose to be
achieved by ‘IBC’, word ‘employed’ in section 97(1) can only
be construed as ‘directory’ and not a mandatory one, that too
by adopting a purposeful, meaningful, practical, pragmatic and
result oriented approach, with a view to prevent an aberration
of justice and to secure ends of justice
Whether therefore, provisions of section 97(1) and 97(2) of
‘IBC’ whereby ‘Adjudicating Authority’ is required to obtain
confirmation of Board prior to appointment of ‘Resolution
Professional’ being only directory in nature and not mandatory
and/Adjudicating Authority’ having exercised its judicial
discretion in fair manner for appointment of an ‘IRP’, same
could not be found fault with - Held, yes
Babu A. Dhammanagi Section 95, read with section 97 and 100, of the Insolvency
and Bankruptcy Code, 2016
v.
Individual/firm’s insolvency resolution process - Application
Union of India by creditor
Ref1: Whether insolvency proceedings initiated against personal
guarantor under Code is a time bound process and aforesaid
[2022] 138 taxmann. procedure contains filing of application under section 95
com 406 (Karnataka) for appointment of Resolution Professional by Adjudicating
Authority under section 99, submission of report by
Ref2: Resolution Professional under section 99, recording reasons
(2022) ibclaw.in 81 for recommending request for acceptance or rejection of
HC application and finally admission or rejection of application by
Adjudicating Authority - Held, yes

Key Case Laws
Whether as per procedure prescribed under sections 95

to 100, role of Resolution Professional is limited to make
appropriate recommendation to Adjudicating Authority and
final decision of admission or rejection of application referred
to under section 95 solely lies with Adjudicating Authority -
Held, yes
Whether Adjudicating Authority is not bound by
recommendation made by Resolution Professional - Held,
yes
Whether procedure prescribed under provisions contained in
sections 95 to 100 are fair, rational and reasonable and same
cannot be termed to be violative of Article 14 - Held, yes
Rohit Nath @ Rohit Section 95, read with section 94 of the Insolvency and
Rabindranath Bankruptcy Code, 2016
v. Individual/firm’s insolvency resolution process - Application

by creditor
KEB Hana Bank Ltd.
Whether Adjudicating Authority in respect of a guarantor who
[2021] 129 taxmann. has furnished a personal guarantee in connection with credit
com 98 (Madras) facilities obtained by a corporate entity, would be appropriate
Debts Recovery Tribunal - Held, yes
Whether thus, a creditor may apply to jurisdictional Debts

Recovery Tribunal for initiating an insolvency resolution
process against appropriate persons under section 95 - Held,
yes
Whether section 95 pertains to applications by creditors

to initiate insolvency resolution process and section 95(1)
applies to any debtor, other than debtors against whom an
insolvency resolution process may be initiated under other
specific provisions - Held, yes
Whether section 95 cannot be confined to only partnership

debts or construed to permit insolvency resolution process to
be initiated only against relevant firms or their partners - Held,
yes
---
Section 60 of the Insolvency and Bankruptcy Code, 2016,

read with section 128 of the Indian Contract Act, 1872
Corporate person’s Adjudicating Authorities - Adjudicating
Authority

Key Case Laws
Whether section 60 identifies adjudicatory authority in relation

to insolvency resolution and liquidation for corporate persons
- Held, yes
Whether section 60(1) mandates that insolvency resolution

and liquidation for corporate persons, including corporate
debtors and personal guarantors, may be brought before
NCLT having territorial jurisdiction over places where
registered office of corporate person is located - Held, yes
Whether further, section 60(2) discloses that section 60 would

apply to an individual only if there is a corporate insolvency
resolution process pertaining to corporate entity which is
principal debtor, that has been filed or commenced - Held,
yes
State Bank of India NCLAT held that if two Applications can be filed, for the same
Vs. Athena Energy amount against Principal Borrower and Guarantor keeping in
Ventures Private view the Section 60(2) and (3), the Applications can also be
Limited (2020) ibclaw. maintained. Simultaneously remedy is central to a contract
in 344 NCLAT of guarantee and where Principal Borrower and surety are
undergoing CIRP, the Creditor should be able to file claims in
CIRP of both of them. The IBC does not prevent this. We are
unable to agree with the arguments of Learned Counsel for
Respondent that when for same debt claim is made in CIRP
against Borrower, in the CIRP against Guarantor the amount
must be said to be not due or not payable in law. Under the
Contract of Guarantee, it is only when the Creditor would
receive amount, the question of no more due or adjustment
would arise. It would be a matter of adjustment when the
Creditor receives debt due from the Borrower/Guarantor in
the respective CIRP that the same should be taken note of
and adjusted in the other CIRP.
Gurmeet Sodhi Vs Supreme Court has ordered for
Union of India & ors
WP (Civil) 307/2022 Stay on Personal Guarantor Proceedings
Personal Guarantor shall not transfer, alienate, encumber or

dispose of any of his assets or his legal rights or beneficial
interest
Resolution Professional shall not proceed with filing of the

report
Objections raised by the appellants are that Sec 95,96,97,99

and 100 violation of Fundamental Right as per Article 32.
[Note: Supreme Court has tagged the case with similar

petitions pending before SC and awaits final orders]

Difference Between Corporate
Insolvency & Individual Insolvency’s
The major differences between the Corporate Insolvency Resolution Process and the
Individual Insolvency Resolution Process are summarized as under:
Point of difference Personal Insolvency Corporate Insolvency
Application by No classification w.r.t. type Application may vary on the

creditor of creditor i.e. operational or basis of type of creditor
financial
Withdrawal of Yes Yes

Application
Requires 90% consent of Requires 90% consent of CoC
creditors [if COC constituted]
CoC No concept of CoC- All Constitution of CoC mandatory-

creditors have right to attend shall comprise of financial
the meeting creditors only [if no FC, OC will
constitute COC]
Meeting of Not Mandatory- shall be Mandatory to conduct the CoC
Creditors conducted if deemed
necessary by the RP –
subject to conditions
Moratorium Yes Yes
Interim Moratorium Yes No
Approval of Plan Requires 75% assent of Requires 66% assent of CoC

creditors present and voting
Rejection of plan Application for bankruptcy Leads to compulsory liquidation
may be filed
Distinction b/w Creditors classified as No classification b/w financial
creditors financial, operational and or operational- only secured &
other creditors unsecured

Difference Between Corporate
Liquidation & Individual Bankruptcy
The major differences between the Corporate Liquidation and the Individual Bankruptcy
are summarized as under:
Point of difference Liquidation Bankruptcy

Manner of initiation Automatically triggered Creditor/debtor become entitled
u/s 33 to file for bankruptcy –
[at the end of CIRP time Section 100 – Rejection

period 180/270 days, RP of insolvency resolution
shall submit an application application by AA.
to AA to this effect]
Section 115 – Rejection of
repayment plan by AA.
Section 118 – Premature

closing of repayment plan.
Reversibility/ No specific provision – Possible – by AA, on application

modification or recall right to appeal against or suo-motu – section 142
AA’s order – section 61. (either erroneous initiation or
full repayment).
Interim-moratorium No Yes – sec. 124 (1)- on

application – lasts till
bankruptcy order is passed
Moratorium Sec. 33 - On liquidation Sec. 128 - On bankruptcy order
order being passed being passed
Role of Insolvency As liquidator As bankruptcy trustee

Professional
Estate of debtor Liquidation estate held by Estate of the bankrupt vests in

liquidator as fiduciary for the bankruptcy trustee – section
benefit of all creditors – 154
section 36
Manner of vesting of No conveyance, Section 154(2) provides

estate assignment – the estate is that there is no need for
constructive conveyance, assignment or
transfer for vesting of property
in the trustee.

Difference Between Corporate Liquidation & Individual Bankruptcy
Involvement of Liquidator has to Considerable - meeting of

creditors constitute Stakeholder’s creditors is summoned, a
Consultation Committee committee of creditors is
(including creditors). No appointed for approval of the
provision for a committee report on administration of the
of creditors. estate; the bankruptcy requires
approval of the committee for
several acts (section 153),
and the committee of creditors
decides on the release of the
bankruptcy trustee.
Priority of pay-out Sec. 53 – financial Sec. 178 – distinction

from estate debts take priority over b/w financial creditor and
operational debts operational creditor does not
exist [even if the individual is
carrying on business]
Final Stage Dissolution – the entity Discharge – releases the

loses its existence. bankrupt from all bankruptcy
debts.

Role of RP’s During Initiation of Individual
Insolvency Resolution Process &
Preparation of RP Report
Relevant Sections / Role of RPs Challenges Recommendations/

Regulations / Rules. Best Practices
Section 94: Application by

debtor to initiate insolvency
resolution process.
1. A debtor who commits a • RP shall verify the • Understanding • Irrespective

default may apply, either existence of the default of the Personal of the details
personally or through a and the quantum of the Guarantor of the / information
resolution professional, to default. IB Code, 2016 provided by
the Adjudicating Authority and process of the Debtor, the
• Whether application
for initiating the insolvency the Individual RP shall do a
is filed directly by the
resolution process, by Insolvency preliminary due-
Debtor or through an RP,
submitting an application. Resolution diligence about the
the RP shall assess his
Process. client and public
2. Where the debtor is a independence in term so
search of available
partner of a firm, such debtor Reg 4 and document the • The Debtor may
information,
shall not apply under this same. hide many facts,
before accepting
Chapter to the Adjudicating asset liability
• The RP shall ensure to assignment.
Authority in respect of the details, contracts
submit a written consent in
firm unless all or a majority etc., to negotiate • Ensure proper
Form A to the Adjudicating
of the partners of the firm file a lower fees for documentation
Authority.
the application jointly. the RP. of the facts and
• RP can facilitate information shared
3. An application under • The Debtor may
preparation of the NCLT / discussed with
sub-section (1) shall be hide some assets
application for initiation of the Debtor and
submitted only in respect with the intention
the IRP against the debtor sign off all the
of debts which are not to defraud the
[Reg.6 Form A] discussion minutes
excluded debts. creditors.
• RP to ascertain and with him as far as
4. A debtor shall not be entitled • The validation possible.
classify included and
to make an application under of the estimated
excluded debts
sub-section (1) if he is— value and
• RP shall ensure to check excluded
(a) an undischarged
the status of the existing assets during
bankrupt;
CIRP / Liquidation the application
(b) undergoing a fresh start proceedings against the stage will be
process; Debtor and ascertain the challenging
appropriate Adjudicating
(c) undergoing an insolvency
Authority [NCLT / DRT]
resolution process; or
• RP shall ascertain the
(d) undergoing a bankruptcy
Territorial Jurisdiction of
process.
the AA, after careful review
of Debtors usual place
of residence / business /
employment

Role of RP’s During Initiation of Individual Insolvency Resolution Process & Preparation of RP Report
5. A debtor shall not be eligible • Incase of application filing

to apply under sub-section is through RP, RP shall
(1) if an application under ascertain the detailed
this Chapter has been scope of work and sign an
admitted in respect of the engagement letter with the
debtor during the period of debtor clearly specifying
twelve months preceding his scope of work as per
the date of submission of IBC, his independence and
the application under this fees payable.
section.
• Wherever the application is
6. The application referred to filed through RP, although
in sub-section (1) shall be in the RP is signing only
such form and manner and the Part IV of the form,
accompanied with such fee the RP shall ensure due
as may be prescribed. verification of all the
contents of the form with
appropriate documents
before signing the form.
• RP can request for income
declaration certificate / ITR
copies / Audited financial
statements under an
affidavit from the Debtor
95 - Application by creditor
to initiate insolvency
resolution process.
1. A creditor may apply either • Copy of the demand notice • Same as stated • Same as stated
by himself, or jointly with served by the Creditor in above in Sec 94 above in Sec 94
other creditors, or through Form B [Rule 7(1)] to the
a resolution professional to Debtor
the Adjudicating Authority
• All other roles as defiled
for initiating an insolvency
above for Sec 94 related
resolution process under
checks
this section by submitting an
application.
2. A creditor may apply under
sub-section (1) in relation
to any partnership debt
owed to him for initiating
an insolvency resolution
process against—
(a) any one or more partners
of the firm; or
(b) the firm.

3. Where an application
has been made against
one partner in a firm, any
other application against
another partner in the same
firm shall be presented
in or transferred to the
Adjudicating Authority in
which the first mentioned
application is pending for
adjudication and such
Adjudicating Authority
may give such directions
for consolidating the
proceedings under the
applications as it thinks just.
4. An application under
sub-section (1) shall be
accompanied with details
and documents relating to—
(a) the debts owed by the
debtor to the creditor or
creditors submitting the
application for insolvency
resolution process as on
the date of application;
(b) the failure by the debtor
to pay the debt within a
period of fourteen days of
the service of the notice
of demand; and
(c) relevant evidence of such
default or non-repayment
of debt.
5. The creditor shall also
provide a copy of the
application made under sub-
section (1) to the debtor.
6. The application referred to
in sub-section (1) shall be in
such form and manner and
accompanied by such fee as
may be prescribed.
7. The details and documents
required to be submitted
under sub-section (4)
shall be such as may be
specified.

96 - Interim-moratorium
1. When an application is filed • Optional Roles [not • In the initial • The RP who has
under section 94 or section mandatory] days, the lack of already signed
95— knowledge about the Form A
• List down all the debts
the individual [application] can
(a) an interim-moratorium and creditors to whom this
insolvency and guide the Debtor
shall commence on the moratorium applies and
the moratorium to send in the fact
date of the application the RP can communicate
are likely to of PG form filing to
in relation to all the with them regarding the
cause lot of all the concerned
debts and shall cease to filing of PG application
misunderstanding authorities at the
have effect on the date and update them about
in the credit earliest, so that
of admission of such the interim-moratorium
market, wherein the authorities are
application; and in force. Even a copy
they will continue appraised of the
of the application filing
(b) during the interim- with the legal fact of filing of the
acknowledgement be
moratorium period— cases…. PG-IRP petition.
shared with them for their
(i) any legal action records, which will prevent • The Debtors may
or proceeding unwanted notices and file some bogus
pending in respect continuation of litigations. / incomplete
of any debt shall applications to
• RP can intimate the
be deemed to have delay the legal
respective courts, where
been stayed; and cases of the
the matters are pending
(ii) the creditors of creditors.
the debtor shall • Although
not initiate any proceedings
legal action or words are there,
proceedings in the government
respect of any debt. authorities are
2. Where the application has likely to continue
been made in relation to a their regular
firm, the interim-moratorium assessment
under sub-section (1) shall proceedings [IT,
operate against all the GST, PF, ESI
partners of the firm as on the etc.,] and pass
date of the application. orders during the
moratorium.
3. The provisions of sub-
section (1) shall not apply
to such transactions as may
be notified by the Central
Government in consultation
with any financial sector
regulator.
97 - Appointment of
resolution professional.
1. If the application under • If another RP name is • The time RP • Keep track of all
section 94 or 95 is filed suggested by IBBI, upon signed the form your consents
through a resolution receipt of appointment and the time given for CIRP /
professional, the of order from NCLT, RP the matter is PG cases.
Adjudicating Authority shall should submit his consent listed and RP
direct the Board within form to the NCLT report is appointed
seven days of the date of appropriate Form as and may differ from
the application to confirm when notified to IBBI / few days to few
that there are no disciplinary IIIPICAI [currently IP-1 months depending
proceedings pending against forms are notified only for upon the workload
resolution professional. CIRP process] of the NCLT
and the legal
jurisprudence.

2. The Board shall within • The RP shall contact / • The time • Incase if you are
seven days of receipt of write to the concerned estimates of overloaded and
directions under sub-section Debtor / applicant for the RP may go can’t take any
(1) communicate to the obtaining copy of the haywire due to more new cases,
Adjudicating Authority in application, so that he can delays in judiciary. file a memo /
writing either— start the review and report request before
• IBBI has
preparation work. AA seeking not
(a) confirming the replaced the
to appoint you in
appointment of the • The RP shall initiate recommendation
delayed cases
resolution professional; collection of various data with a 6 month
[because after
or about the PG debtor from empanelment
appointment
all the market sources list. At present
(b) rejecting the appointment asking for change
available, inorder to speed scenarios, due
of the resolution by the RP will not
up the process timeline. to AFA expiry /
professional and go well before AA]
renewal issues,
nominating another
one can get
resolution professional
enlisted for only
for the insolvency
one term in the
resolution process.
list in a year.
3. Where an application under
section 94 or 95 is filed by
the debtor or the creditor
himself, as the case may
be, and not through the
resolution professional,
shall direct the Board,
within seven days of the
filing of such application,
to nominate a resolution
professional for the
insolvency resolution
process.
4. The Board shall nominate
a resolution professional
within ten days of receiving
the direction issued by the
Adjudicating Authority under
sub-section (3).
5. The Adjudicating Authority
shall by order appoint the
recommended under sub-
section (2) or as nominated
by the Board under sub-
section (4).
6. A resolution professional
appointed by the
under sub-section (5) shall
be provided a copy of the
application for insolvency
resolution process.

98 - Replacement of
1. Where the debtor or the • Submit appropriate • The lack of proper • Maintaining a
creditor is of the opinion that consent form [Form A] documentation detailed daily
the resolution professional and handover by report of the facts,
• If the RP change matter is
appointed under section 97 the erstwhile RP actions taken in
discussed in the creditors
is required to be replaced, cause extreme the PG insolvency
meeting, the existing RP
he may apply to the difficulties for new case will facilitate
shall ensure to minitize the
Adjudicating Authority for RP to pursue the a proper handover
detailed discussion and
the replacement of the such case. and also
consider the resolution
resolution professional. preparation of
among the creditors. • The inordinate
progress reports
2. The Adjudicating Authority Incase of the existing RP delays of the
as and when
shall within seven days is not in support of such Adjudicating
needed.
of the receipt of the change for any specific authority in
application under sub- reason, the RP shall hearing and
section (1) make a inform the creidtors and deciding the new
reference to the Board document the same in the RP appointment
for replacement of the minutes, for appropriate matters will
resolution professional. consideration of the NCLT hinder the flow
during adjudication of the of the resolution
3. The Board shall, within
change over request. Process.
ten days of the receipt
of a reference from the • Existing RP shall prepare
Adjudicating Authority a comprehensive list of
under sub-section (2), handover documents, as
recommend the name of the may be application under
resolution professional to various provisions of the
the Adjudicating Authority act, rules and regulations
against whom no disciplinary and take a proper
proceedings are pending. acknowledgement of the
handover from the new RP
4. Without prejudice to the
provisions contained • The RP shall ensure to
in sub-section (1), the retail such hard copy / soft
creditors may apply to copy of all the data as may
the Adjudicating Authority be prescribed by the IBBI
for replacement of the as per the preservation of
resolution professional records regulations.
where it has been decided in
• As far as possible, the
the meeting of the creditors,
existing RP shall make a
to replace the resolution
detailed day-wise progress
professional with a new
of the case, minutes of
all discussion in a very
for implementation of the
detailed report and provide
repayment plan.
the same to the new RP,
5. Where the Adjudicating so that the entire facts are
Authority admits an appraised to the new RP
application made under for further success of the
sub-section (1) or sub- IRP process
section (4), it shall direct
the Board to confirm that
there are no disciplinary
proceedings pending against
the proposed resolution
professional.

6. The Board shall send a

communication within
ten days of receipt of the
direction under sub-section
(5) either—
(a) confirming appointment of
the nominated resolution
professional; or
(b) rejecting appointment
of the nominated
and recommend a new
7. On the basis of the
communication of the
Board under sub-section
(3) or sub-section (6) , the
Adjudicating Authority shall
pass an order appointing a
new resolution professional.
8. The Adjudicating
Authority may give
directions to the resolution
professional replaced under
sub-section (7)—
(a) to share all information
with the new resolution
professional in respect of
the insolvency resolution
process; and
(b) to co-operate with
the new resolution
professional in such
matters as may
be required.
99 - Submission of report by
1. The resolution professional • All the roles as listed • Timeline of • If the application
shall examine the application above from Section 94 & getting the details is filed through
referred to in section 94 or 95 to be done by the RP from the debtor the RP, then the
section 95, as the case may and the creditors concerned RP
• RP shall verify all the
be, within ten days of his will become a shall start collating
information and facts
appointment, and submit a big issue, as the data well in
furnished in the application
report to the Adjudicating the report to be advance before AA
with the relevant source
Authority recommending for submitted within orders.
documents and keep
approval or rejection of the 10, wherein the
appropriate audit evidence • RP shall prepare
application. communication,
of such verification and a clear checklist
2. Where the application has making
validation by him of details to be
been filed under section 95, concerned people
collected, be
the resolution professional • RP shall immediately understand
clear with all the
may require the debtor to write to all tax authroities, about the law
available sources
prove repayment of the debt banks and all other known and furnish
of information, etc.,
claimed as unpaid by the creditors to ascertain the information will
[a good networking
creditor by furnishing— correctness of all the debts take longer time
of the RP with
reported in the form in the early days.
(a) evidence of electronic others will facilitate
transfer of the unpaid faster retrieval
amount from the bank of required
account of the debtor; information].

(b) evidence of encashment • RP shall carry out such • The Debtor may • As much as
of a cheque issued by due-diligence check to not extend his possible, RP shall
the debtor; or validate the existence co-operation ensure to submit
(c) a signed acknowledgment and title of all the assets and furnish all the supporting
by the creditor accepting reported in the application, the information evidences and
receipt of dues. to establish appropriate [especially the reasoning
3. Where the debt for which an comfort before certifying incase of Sec for his opinion
application has been filed by the form 95- creditor filed in the report
a creditor is registered with cases]. Without with all required
• RP shall carry out discrete
the information utility, the Debtor co- annexures. RP
enquiry and verification
debtor shall not be entitled operation, report need not worry
of various assets of the
to dispute the validity of preparation will about bulkiness of
Debtor, to ascertain any
such debt. be very tough and the report. It can
intentional or unintentional
4. For the purposes of likely chance of have a synopsis
missout of the asset or
examining an application, many missouts for faster perusal
liability
the resolution professional of AA. However,
• The statutory
may seek such further • Wherever needed, RP RP shall ensure
authorities are
information or explanation can take appropriate that the report is
likely to take
in connection with the legal opinions on the comprehensive
longer time
application as may be contracts, so as to arrive to defend any
to furnish the
required from the debtor at a proper conclusion objections.
information, as
or the creditor or any and recommend to the
the nodal officers
other person who, in the Adjudicating Authority for
are not yet in
opinion of the resolution acceptance / rejection of
place to facilitate
professional, may provide the application
such information
such information.
• RP shall formally minutize sharing.
5. The person from whom all the discussion with the
information or explanation is Debtors, Creditors and
sought under sub-section (4) all other stakeholders
shall furnish such information and ensure proper
or explanation within seven documentation and
days of receipt of the request. preservation of the same,
6. The resolution professional as the AA may call for any
shall examine the application evidence for forming such
and ascertain that— an opinion of acceptance /
(a) the application satisfies rejection.
the requirements set out
in section 94 or 95;
(b) the applicant has provided
information and given
explanation sought by the
under sub-section (4).
7. After examination of the
application under sub-section
(6), he may recommend
acceptance or rejection of the
application in his report.
8. Where the resolution
professional finds that
the debtor is eligible
for a fresh start under
Chapter II, the resolution
professional shall submit
a report recommending
that the application by the
debtor under section 94 be
treated as an application
under section 81 by the
Adjudicating Authority.

9. The resolution professional

shall record the reasons
for recommending the
acceptance or rejection of
the application in the report
under sub-section (7).
10. The resolution professional
shall give a copy of the
report under sub-section (7)
to the debtor or the creditor,
as the case may be.
100 - Admission or rejection

of application.
1. The Adjudicating Authority • An RP shall monitor the • Wherever the RP • RP shall keep
shall, within fourteen days progress of the case and is appointed by monitoring the
from the date of submission provide such assistance to the NCLT from progress of the
of the report under section 99 the AA for final orders, as the empanelment case and assist
pass an order either admitting may be called upon by the list, there is lot AA with additional
or rejecting the application AA during the course of the of uncertainty in details as and
referred to in section 94 or 95, hearing fees and expense when called for
as the case may be. realization for the by the AA during
• Incase AA directs for RP. the application
2. Where the Adjudicating negotiation, RP shall adjudication
Authority admits an ensure free and fair • The timeline delay process.
application under sub-section negotiation between debtor in application
(1), it may, on the request of and all the creditors as admission leaves
the resolution professional, the case may be. RP shall the RP in lurch,
issue instructions for the analyse and facilitate the as he can’t plan
purpose of conducting negotiation process with his work timelines
negotiations between the ground realities of the law, and commit for
debtor and creditors and for money realizable, potential taking other
arriving at a repayment plan. risk of litigation delays assignments
3. The Adjudicating Authority etc., and facilitate for a
shall provide a copy of negotiation / compromise
the order passed under arrangement.
sub-section (1) along with • RP shall ensure that
the report of the resolution the copies of the order
professional and the are received by all the
application referred to in respective parties in time.
section 94 or 95, as the case Wherever there are miss
may be, to the creditors out in communication, RP
within seven days from the shall ensure that such
date of the said order. communication are sent
4. If the application referred to from his desk to ensure
in section 94 or 95, as the smooth flow of insolvency
case may be, is rejected by process.
the Adjudicating Authority on
the basis of report submitted
by the resolution professional
that the application was made
with the intention to defraud
his creditors or the resolution
professional, the order under
sub-section (1) shall record
that the creditor is entitled
to file for a bankruptcy order
under Chapter IV.

101: Moratorium.
1. When the application is • RP shall prepare a list • Despite • Depending on the

admitted under section of all pending cases, moratorium, gravity of the case,
100, a moratorium shall Outstanding debts and the government location of assets
commence in relation to all communicate to all the agencies like etc., RP may
the debts and shall cease creditors regarding tax authorities apply for passport
to have effect at the end of the commencement [Income Tax, impounding in
the period of one hundred of Insolvency Process GST, PF, ESI advance before
and eighty days beginning and the moratorium etc.,] continue the AA.
with the date of admission declared, so as to avoid to issue notices
• Proactive
of the application or on unnecessary notices. and carry-on
communication to
the date the Adjudicating their assessment.
• Wherever there are all the concerned
Authority passes an order on Any amount of
contradictory stands legal authorities
the repayment plan under written letters to
against the said and courts
section 114, whichever is those department
moratorium, RP shall regarding the
earlier. regarding the
approach AA appropriately moratorium will
moratorium is of
2. During the moratorium for necessary directions, help RP to reduce
no use in current
period— to ensure smooth process unwanted progress
practice.
if insolvency resolution of the litigations.
(a) any pending legal action
process. • As there is no
or proceeding in respect
mention about
of any debt shall be
Civil or Criminal
deemed to have been
suits in the
stayed;
statute, whether
(b) the creditors shall not the criminal cases
initiate any legal action like Cheque
or legal proceedings in bounce [Sec 138
respect of any debt; and of NI Act], etc.,
(c) the debtor shall not can continue
transfer, alienate, against the
encumber or dispose of debtor – will be a
any of his assets or his question?
legal rights or beneficial • The legal
interest therein; actions and
3. Where an order admitting cases in foreign
the application under jurisdictions
section 96 has been made will continue,
in relation to a firm, the until a bilateral
moratorium under sub- arrangement
section (1) shall operate and cross border
against all the partners of insolvency
the firm. process are
established.
4. The provisions of this
section shall not apply to • Whether the
such transactions as may Debtor is
be notified by the Central allowed to travel
Government in consultation abroad will be
with any financial sector a big question.
regulator. As there is no
express rule here
for impounding
passport, this will
be a challenging
area wherein the
RP has to act in
time to avoid any
mischiefs by the
debtor.

Role of RP’s During Claim Processing /
Admission / List of Creditors

102 - Public notice and

claims from creditors.
1. The Adjudicating • Although the law • No specific format of public • RP shall make
Authority shall issue specific AA for notice defined in the Rules a choice of
a public notice within issuance of public and Regulations. As the newspaper having
seven days of passing notice, in general minimum requirements only wider coverage
the order under section practice, the AA are specified in the law, there in the locality
100 inviting claims directs the RP to may be wide varities of format where he resides
from all creditors within make the public will be used and the parties [eg: choice of
twenty-one days of such notice. may even litigate this public newspaper edition
issue. notices. should be such
that the locality
2. The notice under • There won’t be any books
and the district is
sub-section (1) shall of accounts in most of the
covered].
include— individual cases. They won’t
have any balance sheet. Even • Ensure proper
(a) details of the order
the debtor himself will keep translated copy
admitting the
on adding and deleting asset of the notice
application;
related information from time in vernacular
(b) particulars of to time. language is
the resolution published [no
• Law provides for display
professional with English notice
of notice in AA webportal.
whom the claims are in vernacular
The AA portals are not yet
to be registered; and newspaper].
upgraded / are designed
(c) the last date for for such numerous notice • Depending upon
submission of claims. uploads. This will be a the nature of
3. The notice shall be— non-compliance in the initial business, lenders
days until the time the IBBI and creditors
(a) published in at or AA defines a process and type in each
least one English procedure for the same. case, adapt such
and one vernacular other mediums of
newspaper which • Publication of notice in
communication
is in circulation in newspaper – the law specifies
of the notices
the state where the “In Circulation in State” –
[incl.whatsapp
debtor resides; whether it has to be published
etc.,] so that the
across the entire state OR
(b) affixed in the notice reaches the
in the specific edition where
premises of the maximum number
he resides – these points
Adjudicating of creditors at
will be a bigger concern for
Authority; and the earliest and
RP, as the parties may raise
they submit their
(c) placed on the website objection on the coverage
claims.
of the Adjudicating issue later.
Authority. • Who will fund for the public
notice expenses is a big
question. Getting money from
Debtor is difficult. Funding
becomes a challenge?

Role of RP’s During Claim Processing / Admission / List of Creditors
103 - Registering of
claims by creditors.
1. The creditors shall • The RP shall • The claims won’t be received • RP shall prepare
register claims define a details in time. There will be lot of and maintain
with the resolution process for receipt belated claims OR some clear work papers
professional by sending and verification cases claims may come after for each claims
details of the claims of claims [Form finalization of the repayment received and
by way of electronic B] in their office plan. verified. The
communications or covering receipt work papers are
• Some of the claims may be
through courier, speed of claim by the most crucial
time barred may be 5/10
post or registered letter. various modes, documents
years old. Whether the RP
acknowledging to evidence
2. In addition to the claims has power to reject those
those claims, proper review
referred to in sub-section claims on the grounds
preliminary and admission /
(1) , the creditor shall to limitation of time is an
review, calling for rejection of claims.
provide to the resolution unanswered question. Even
additional details,
professional, personal the AA has not clarified such
final review and
information and such issues in the CIRP cases.
acceptance /
particulars as may be
rejection of claim,
prescribed.
communication
to the said
claimant regarding
acceptance /
rejection etc.,
• As the law
specifies a
maximum
threshold of days
for verification of
claims, RP shall
ensure proper
review and claim
admissions within
the stipulated
time, so that the
process timelines
are adhered to.
• Wherever there
are ambiguity
in amounts or
the claim is not
fully crystallised,
the RP shall
ensure proper
documentation
with reasoning
for admitting the
claim with best
estimates and
shall periodically
review such claims
with the additional
information /
evidence received
due course.

Role of RP’s During Claim Processing / Admission / List of Creditors
104- Preparation of list

of creditors.
1. The resolution • The RP shall • The delay in receipt of claim • For claim review
professional shall prepare a detailed from various creditors will and admission,
prepare a list of creditors list of creidtors be big challenge in finalizing List of creditors
on the basis of— containing the this list of creditors. The etc., adopting
details of the claims may continue to flow a standardized
(a) the information
creditor including even after finalization of templates will
disclosed in the
address and the list. Whether the RP is facilitate RP
application filed by
identification empowered to accept belated for efficient
the debtor under
details, claims claims and make modification functioning. May
section 94 or 95, as
amount and nature to the list of creditors is not be adoption of
the case may be;
of claims, details expressly provided in the law. some software
(b) claims received of security interest There are likely disputes in [new software are
by the resolution etc., this front in the day to come now available in
professional under market] will help
• Considering the
section 102. RP’s to stream line
limited timelines,
2. The resolution the process.
RP shall ensure
professional shall to keep the • Defining an
prepare the list list prepared inspection process
mentioned in sub- parallel to the and fixed timing
section (1) within thirty claim verification for creditors
days from the date of the process, as some inspection of the
notice. debtors case will said list will ease
be flooded with the process.
voluminous claims
running into many
thousands.
• RP shall ensure
proper display
of the list of
creditors in the
Gurantors website
and ensure that
the said list is
available for
inspection to the
claimants.

Role of RP’s During Repayment Plan & Meeting
Creditors for the Approval/Consideration
of the Repayment Plan

105. Repayment Plan
1. The debtor • To provide assistance, • Lack of • Try to establish a
shall prepare, in wherever required, in the Cooperation from healthy relationship
consultation with the preparation of Repayment the Personal with the personal
resolution professional, Plan to personal guarantor as Guarantor which guarantor in order
a repayment plan per Section 105. includes tile to obtain the
containing a proposal • To perform such functions documents of relevant details
to the creditors for and duties, if authorised his/ her property, or information in
restructuring of his or required to be done by location of the effective manner.
debts or affairs. Resolution Professional assets and such • To generate Credit
in the repayment plan, as other information/ Rating Report such
2. The repayment plan
per section 105(2) of the documents as may as CIBIL, CRIF High
may authorise or
Insolvency and Bankruptcy be necessary. Mark, Equifax etc in
require the resolution
professional to - Code, 2016. • Difficulty in tracking order to cross verify
• To identify the assets owned the actual position the debt owed by
(a) carry on the of the available personal guarantor.
debtor’s business by personal guarantor and
his/ her immediate family assets in the name • To obtain due-
or trade on his of the personal
members and preparation of diligence report from
behalf or in his guarantor.
list of these assets. expert agencies
name; or
• To prepare a chart of his/ her • Taking possession in order to identify
(b) realise the assets of the individual the shareholding,
immediate family members
of the debtor; or as per Section 79 (17) and properties is a directorship and
(c) administer or associates as per Section challenging task other relevant
dispose of any 79(2) of IB Code, 2016 read due to emotional information.
funds of the debtor. with Rule 4 of Insolvency values attached
and Bankruptcy (Application with the personal
3. The repayment plan guarantor as well
to Adjudicating Authority
shall include the as his/ her family
for Insolvency Resolution
following, namely: - members.
Process for Personal
(a) justification for Guarantors to Corporate • Non-disclosure of
preparation of such Debtors) Rules, 2019. his/ her immediate
repayment plan • To ascertain the excluded family/ relatives/
and reasons on the assets and excluded debt as associates by
basis of which the per Section 79 sub-section 14 personal guarantor.
creditors may agree for excluded asset and sub- • To determine the
upon the plan; section 15 for excluded debt. consequences
• Checking reasonableness in case of non-
of the proposed justification implementation of
for preparation of such Repayment Plan
repayment plan and reasons effectively.
on the basis of which the
creditors may agree upon
the plan.

Role of RP’s During Repayment Plan & Meeting Creditors for the Approval/Consideration of the Repayment Plan
(b) provision for • To estimate the Insolvency • Sometimes the

payment of fee Process Cost and to ensure person changed
to the resolution the provision for payment their residential
professional; of fee to the resolution location from one
(c) such other professional. to another and
matters as may be it is difficult to
• To determine the
specified. trace their present
consequences in case
location to carry out
of non-implementation of
the process.
Repayment Plan effectively
and in timely manner.
• Any other matters on case-to-
case basis as RP may deem
fit/ necessary.
106. Report of
on repayment plan.
1. The resolution • Vetting of the Repayment • To determine • To obtain affidavit/

professional shall Plan in confirmation with the the reasonable undertaking from
submit the repayment contents as specified under prospect of the personal guarantor
plan under section 105 Reg. 17 of IBBI (Insolvency Repayment Plan. with respect to:
along with his report Resolution Process of
• To define and (a) assets owned
on such plan to the Personal Guarantor
Adjudicating Authority justify the hair cut by personal
to Corporate Debtors)
within a period of proposed in the guarantor;
Regulations, 2019 and other
twenty-one days Repayment Plan.
applicable provisions. (b) his/ her
from the last date of • To justify immediate
submission of claims • To ascertain the reasonable
the futuristic family
under section 102. prospect of approval
implementation of members,
and implementation of
2. The report referred in the Repayment relatives and
Repayment Plan.
sub-section (1) shall Plan in an effective
include that- • To record the reasons and efficient
whether there is a manner.
(a) the repayment plan requirement for summoning
is in compliance • To determine the
the meeting of creditors or
with the provisions genuineness of the
not.
of any law for the source of funds
time being in force; • To specify such date, time proposed by the
and place of meeting which personal guarantor
(b) the repayment plan
is to be held if he thinks that for the purpose of
has a reasonable
a meeting of creditors should Repayment Plan.
prospect of being
be summoned and such date,
approved and
implemented; and time and venue of meeting
shall be in accordance
with Section 106(4) of the
Insolvency and Bankruptcy
Code, 2016.

(c) there is a necessity • To submit his report along • To establish the (c) associates;
of summoning with Repayment Plan to the reasonableness (d) excluded
a meeting of Adjudicating Authority within of the reasonable assets;
the creditors, specified time period. expenses as per
if required, to Reg. 17(1)(c) of (e) reasonable
• Resolution Professional expenses to
consider the IBBI (Insolvency
to ensure that his report determine
repayment plan: Resolution Process
includes and covers items minimum
of Personal budget.
Provided that mentioned in Section 106(2)
Guarantor to
where the of the Insolvency and • Appointment of
Corporate Debtors)
resolution Bankruptcy Code, 2016. detective agency to
Regulations, 2019.
professional trace the assets of the
• To ensure the priority of
recommends • To adhere to personal guarantor.
payment of debts as per
that a meeting of the prescribed
Section 178 of IB Code, • Draft repayment plan
the creditors is timelines as there
2016. may be discussed
not required to may be lack of
be summoned, • Valuation of the assets in cooperation from with various
reasons for the case personal guarantor the personal stakeholders for their
same shall be proposed to make the guarantor. inputs/ suggestions
provided. payment by realisation from before finalisation.
sale of his/ her assets. • To enquire about the
3. The report referred to
in sub-section (2) shall standard of living of
also specify the date personal guarantor
on which, and the time with the neibours/
and place at which, relatives/ friends/
the meeting should else in order to justify
be held if he is of the he minimum budget
opinion that a meeting proposed by the
of the creditors should personal guarantor in
be summoned. the Repayment Plan
as per Reg. 17(1)(c)
4. For the purposes of of IBBI (Insolvency
sub-section (3) - Resolution Process
5. the date on which the for Personal
meeting is to be held Guarantor to the
shall be not less than Corporate Debtors)
fourteen days and not Regulations, 2019.
more than twenty-eight • To obtain undertaking
days from the date of for reasonable
submission of report assurance in case
under subsection (1); personal guarantor
6. the resolution proposed to bring
professional shall funds for the purpose
consider the of repayment
convenience of plan from external
creditors in fixing the sources.
date and venue of • To appoint valuer for
the meeting of the valuation of assets
creditors. in case personal
guarantor proposes to
bring funds by sale of
assets.

107. Summoning of
meeting of creditors.
1. The resolution • To verify the claims received • To determine claim • RP may serve notice
professional shall and preparation of list of amount to be of meeting through
issue a notice calling creditors accordingly. admitted in case various modes of
the meeting of the of Resolution Plan communication
• To prepare the sheet
creditors at least of CD is pending i.e., electronically
representing the voting share
fourteen days before for approval before (Email, WhatsApp),
of each creditor as per the
the date fixed for such Adjudicating R.P.A.D./ Courier,
admitted claim amount.
meeting. Authority or etc.
• To issue a notice calling the distribution of funds
2. The resolution • It is advisable to
meeting of creditors at least under Liquidation is
professional shall have a meeting
14 days before the date of in process.
send the notice of the with creditors and
such meeting and send such
meeting to the list of • Coordination with record their inputs
notice to the creditors as
creditors prepared various creditors and suggestions on
per list of creditors prepared
under section 104. for seeking repayment plan.
under section 104 of the
information/
3. The notice sent under Insolvency and Bankruptcy • Venue for meeting
documents
sub-section (1) shall Code, 2016. may be decided
required for the
state the address as per the location
• Resolution Professional to purpose of claim
of the Adjudicating of largest no. of
ensure that the notice issued verification.
Authority to which the creditors.
under section 107(1) should
repayment plan and • To collate the
contain and be accompanied • To prepare notice
report of the resolution assets and
by such items as mentioned of the meeting
professional on the liabilities of
in section 107(3) of the with detailed
repayment plan has personal guarantor,
Insolvency and Bankruptcy agenda items to be
been submitted and excluded assets
Code, 2016 and Regulation discussed.
shall be accompanied and debts, Income
12 of IBBI (Insolvency
by - Tax Returns, Debt • The notice shall
Resolution Process for
owed by guarantor carry the necessary
(a) a copy of the Personal Guarantors
to his associates, agenda to be
repayment plan; to Corporate Debtors)
guarantees given discussed in the
Regulations, 2019.
(b) a copy of the in relation to meeting along
statement of affairs • The notice shall contain his debts, and with detailed notes
of the debtor; venue, time, date of the whether any of the to agenda with
meeting and option shall be guarantors is an documents required
(c) a copy of the
available to the participants associate of the to participants for
said report of
to attend the meeting either guarantor, details decision making
the resolution
in person, through video of business owned and draft resolutions
professional; and
conferencing or by electronic by the guarantor or wherever necessary
(d) forms for proxy mode/ proxy. of his firm in which for voting upon.
voting. he is a partner,
• The notice shall carry the
4. The proxy voting, necessary agenda to be as the case may
including electronic discussed in the meeting be or any other
proxy voting shall take along with detailed notes related information
place in such manner to agenda with documents required for
and form as may be related to it. preparation of
specified. statement of affairs.
• The notice shall contain
the Insolvency Resolution • There is no
Process Cost incurred by RP standard format
till the date of meeting. available for
preparation of
• Resolution Professional to statement of affairs.
ensure that proxy voting
and electronic proxy voting
shall be conducted as
per applicable rules and
regulations.

• RP shall convene a meeting

of creditors suo-moto or on a
request by creditors having
thirty-three percent of voting
share of creditors.
• To prepare the statement
of affairs as per Regulation
10 of IBBI (Insolvency
personal guarantor to
the Corporate Debtors)
Regulations, 2019.
108. Conduct of
1. The meeting of • The Resolution Professional • To obtain the • To ensure the

the creditors shall shall ensure that criteria consent of proper connectivity,
be conducted in of the quorum are fulfilled debtors as per the compatibility and
accordance with the if creditors representing at suggestions of the other necessary
provisions of this least thirty-three percent of creditors on the infrastructure in
section and sections voting share are present in repayment plan as case meeting to
109, 110 and 111. person, by proxy or through they do not agree be conducted
video conferencing as per easily on the terms electronically.
2. In the meeting of
Reg. 13 of IBBI (Insolvency and conditions.
the creditors, the • To ensure
creditors may decide • To collate the proper sitting
personal guarantor to
to approve, modify or assets and arrangement(s),
the Corporate Debtors)
reject the repayment liabilities of recording facility and
Regulations, 2019.
plan. personal guarantor, other requirements
3. The resolution • Resolution Professional to excluded assets at the venue of
professional shall ensure that the meeting is and debts, Income the meeting i.e.,
ensure that if conducted in compliance with Tax Returns, Debt conference hall,
modifications are the provisions of this section owed by guarantor office in case of
suggested by the and sections 109, 110 and to his associates, physical meeting.
creditors, consent of 111 read with Reg. 14 of guarantees given
• Opportunity to
the debtor shall be IBBI (Insolvency Resolution in relation to
present their views/
obtained for each Process for personal his debts, and
suggestions should
modification. guarantor to the Corporate whether any of the
be given to each
Debtors) Regulations, 2019. guarantors is an
4. The resolution and every creditor
associate of the
professional may for • The resolution professional on the agenda
guarantor, details of
a sufficient cause shall ensure that if items proposed to
business owned by
adjourn the meeting modifications are suggested be discussed in the
the guarantor or of
of the creditors for a by the creditors, consent of meeting.
his firm in which he
period of not more the debtor shall be obtained
is a partner, as the • Brief note may be
than seven days at a for each modification.
case may be. presented by RP
time. • Resolution Professional to about the actions
• To obtain
ensure that all the agenda taken in insolvency
unanimous
items mentioned in the notice resolution process
consensus among
of the meeting are discussed till the date of
the creditors
and voted upon wherever meeting.
on the terms
necessary.
and conditions
• The Resolution Professional proposed in the
shall ensure that the required repayment plan.
quorum is present throughout
the meeting by taking roll call.

• No person other than

participants and any other
person whose presence
is required by RP, shall
be allowed access to
the meeting without the
permission of RP.
• The resolution professional
may for a sufficient cause,
if need arises, adjourn the
meeting of the creditors for
a period of not more than
seven days at a time.
109. Voting rights in
1. A creditor shall be • The Resolution Professional • Facing technical • To prepare the

entitled to vote at shall prepare minutes of the difficulties in minutes of meeting
every meeting of the meeting, including who voted case of e-voting in a proper manner
creditors in respect of for, against or abstained from proposed for covering a.
the repayment plan in voting on the items put to agenda items. attendance of the
accordance with voting vote in the meeting. creditors;
• Due to non-
share assigned to him.
• RP shall circulate the minutes availability of • the views of each
2. The resolution of meeting by electronic information of and every creditor
professional shall means to all participants of guarantor like and detailed
determine voting share the meeting within forty-eight associates, discussions on
to be assigned to each hours of the conclusion of the relatives etc., the agenda of the
creditor in the manners meeting. it cannot be meeting;
specified by the Board. determined that
• Resolution Professional • proposed resolution
whether the creditor
3. A creditor shall not to assign voting share for meeting
is an associate of
be entitled to vote in percentage to each creditor in
the debtor or not • To appoint voting
respect of a debt for an the manner specified by the
as mentioned in agency for conduct
unliquidated amount. board.
Section 109(4) of of e-voting among
4. A creditor shall not • Resolution Professional to IB Code, 2016. the creditors for
be entitled to vote ensure that every creditor the proposed
• To obtain
in a meeting of the eligible to vote shall vote agenda items in the
unanimous
creditors if he –– and creditors not entitled to meeting.
consensus among
vote shall not vote as per
(a) is not a creditor the creditors on • To give sufficient
provisions of section 109.
mentioned in the the proposed time to the creditors
list of creditors • Resolution Professional to agenda items of the to vote on the
under section 104; ensure that an individual meeting. agenda items
or appointed as a proxy on proposed to be
behalf of the creditor shall passed/ approved in
(b) is an associate of not be an associate of the the meeting.
the debtor. guarantor.
• To ensure proper
 To prepare the sheet voting facility and
representing the voting coordination with the
share of each creditor as creditors to make
per the admitted claim sure the voting of
amount. each and every
creditor on agenda
items proposed for
voting.

• In case of voting by proxy,

RP shall obtain Form C from
the creditor, duly completed
at least twenty-four hours
prior to the meeting of
creditors as per Reg. 16 of
IBBI (Insolvency Resolution
Process for personal
guarantor to the Corporate
Debtors) Regulations, 2019.
• Resolution Professional to
ensure opening of voting
window for atleast 24 hours
from the circulation of the
minutes and circulation of
voting results within twenty-
four hours of the conclusion
of the voting.
• To ensure that a creditor
shall not be entitled to vote
in respect of a debt for an
unliquidated amount.
110. Rights of secured

creditors in relation to
repayment plan.
1. Secured creditors • In case a secured creditor • To verify the • To obtain clarity

shall be entitled to does not forfeit his right to estimated value of from the creditors
participate and vote enforce security, Resolution the unsecured part at the time of
in the meetings of the Professional has to ensure of the debt. admission of their
creditors. that an affidavit stating – claim.
• To coordinate
2. A secured creditor (a) that the right to vote with the secured
participating in the exercised by the secured creditors and
meetings of the creditor is only in respect guarantor in such
creditors and voting of the unsecured part of manner that rights
in relation to the the debt; and of secured creditors
repayment plan shall are protected.
(b) the estimated value of
forfeit his right to the unsecured part of the
enforce the security debt.
during the period of
the repayment plan in • To verify the estimated value
accordance with the of the unsecured part of the
terms of the repayment debt.
plan. • Resolution Professional to
treat secured and unsecured
3. Where a secured
debts of the secured creditor
creditor does not
as separate debts in case a
forfeit his right to
secured creditor participates
enforce security,
in voting by submitting an
he shall submit
affidavit.
an affidavit to the
at the meeting of the
creditors stating -

(a) that the right to vote • Resolution Professional

exercised by the should coordinate with
secured creditor is the secured creditors and
only in respect of guarantor in such manner
the unsecured part that rights of secured
of the debt; and creditors are protected.
(b) the estimated value • To obtain concurrence of
of the unsecured the secured creditor, if he
part of the debt. does not participate in the
voting on repayment plan but
4. In case a secured
provision of the repayment
creditor participates
plan affects his right to
in the voting on the
enforce security.
repayment plan by
submitting an affidavit
under sub-section
(3), the secured and
unsecured parts of the
debt shall be treated
as separate debts.
5. The concurrence of the
secured creditor shall
be obtained if he does
not participate in the
voting on repayment
plan but provision of
the repayment plan
affects his right to
enforce security.
Explanation. – For
the purposes of
this section, “period
of the repayment
plan” means the
period from the
date of the order
passed under
section 114 till the
date on which the
notice is given
by the resolution
professional under
section 117 or
report submitted
by the resolution
professional under
section 118, as the
case may be.

111. Approval of
repayment plan by
creditors.
The repayment plan or • Resolution Professional • To convince the • To coordinate

any modification to the ensure that the repayment stakeholders on properly with the
repayment plan shall be plan prepared by the debtor various terms creditors and
approved by a majority or if any modification if any and conditions/ convince them
of more than three-fourth shall be approved by a modifications on to vote of the
in value of the creditors majority of more than three- the Repayment repayment plan.
present in person or by fourth in value of the creditors Plan.
• To explain pros
proxy and voting on the present in person or by proxy
• To obtain the and cons of the
resolution in a meeting and voting on the resolution
repayment plan to
approval of
of the creditors. in a meeting of the creditors.
the creditors for their
creditors more
than three-fourth approval or dissent.
in value of the
creditors present
in person or by
proxy and voting
on the resolution
in a meeting of the
creditors.
112. Report of meeting

of creditors on
repayment plan.
1. The resolution
professional shall
prepare a report of
the meeting of the
creditors on repayment
plan.
2. The report under
sub-section (1) shall
contain -
(a) whether the
repayment plan
was approved or
rejected and if
approved, the list
the modifications,
if any;
(b) the resolutions
which were
proposed at the
meeting and the
decision on such
resolutions;

(c) list of the creditors • To prepare a report of the • To adhere to • Report of the
who were present meeting of creditors on the timelines in meeting of creditors
or represented at repayment plan. preparation of the on repayment plan
the meeting, and • To ensure that the report report of meeting should be drafted
the voting records should contain: of creditors on in a proper manner
of each creditor for repayment plan. covering all the
(a) whether the repayment detailed discussion
all meetings of the
plan was approved or and decision
creditors; and
rejected and if approved, on proposed
(d) such other the list the modifications, resolution and
information as if any; approval/ rejection/
the resolution
(b) the resolutions which modification of the
professional thinks
were proposed at the repayment plan etc.
appropriate to
meeting and the decision
make known to
on such resolutions;
the Adjudicating
Authority. (c) list of the creditors
who were present or
represented at the
meeting, and the voting
records of each creditor
for all meetings of the
creditors; and
(d) such other information
as the resolution
professional thinks
appropriate to make
known to the Adjudicating
Authority.
113. Notice of
decisions taken at
The resolution • The Resolution Professional - • RP may serve copy

professional shall ensure that copy of the report of the report of
provide a copy of the of the meeting of the creditors the meeting of the
report of the meeting of to be served to all the person creditors through
creditors prepared under as prescribed in section 113 various modes of
section 99 to - of IBC, 2016. communication
i.e., electronically
(a) the debtor; • The resolution professional
(Email, WhatsApp),
shall file the repayment plan,
(b) the creditors, R.P.A.D./ Courier,
as approved by the creditors,
including those who etc.
along with the report
were not present at
mentioned in section 106 or
the meeting; and
112, as the case may be, with
(c) the Adjudicating the Adjudicating Authority
Authority. on or before completion of
120 days from the resolution
process commencement
date.
• The resolution professional
shall provide the copies of
the documents filed with the
Adjudicating Authority under
sub-regulation (1) to the
guarantor and the creditors,
within three days from the
date of such meeting.

114. Order of
on repayment plan.
1. The Adjudicating • To ensure the compliance • To ensure • To draft checklist/

Authority shall by an of order passed by the implementation of layout for proper
order approve or reject adjudicating authority. repayment plan in implementation of
the repayment plan on an effective and repayment plan.
the basis of the report • If in the opinion of timely manner.
of the meeting of the adjudicating authority there
creditors submitted is a requirement of any
by the resolution modification in the repayment
professional under plan then at the direction of
section 112: adjudicating authority the
Resolution Professional shall
2. Provided, that where re-convene a meeting of the
a meeting of creditors creditors for reconsidering the
is not summoned, the repayment plan.
shall pass an order • To ensure implementation
on the basis of the of repayment plan in an
report prepared by the effective and timely manner.
under section 106. • If in the opinion of the
resolution professional,
3. The order of the the guarantor has failed
Adjudicating in implementation of
Authority approving the repayment plan, the
the repayment plan resolution professional
may also provide shall within three days of
for directions for knowledge of such failure
implementing the issue a notice to guarantor
repayment plan. identifying the failure and
requiring him, within fifteen
4. Where the days of receipt of the notice
Adjudicating Authority to address such failure along
is of the opinion with proper explanation.
that the repayment
plan requires
modification, it may
direct the resolution
professional to re-
convene a meeting
of the creditors for
reconsidering the
repayment plan.

115. Effect of order of

on repayment plan.
1. Where the Adjudicating • The resolution professional - -

Authority has approved shall provide the copy of
the repayment plan the order of Adjudicating
under section 114, the Authority to the stakeholders
repayment plan shall – and board.
(a) take effect as
if proposed by
the debtor in the
meeting; and
(b) be binding on
creditors mentioned
in the repayment
plan and the debtor.
2. Where the Adjudicating
Authority rejects the
repayment plan under
section 114, the debtor
and the creditors
shall be entitled to
file an application
for bankruptcy under
Chapter IV.
3. A copy of the order
passed by the
under sub-section
(2) shall be provided
to the Board, for the
purpose of recording
an entry in the register
referred to in section
196.

Role of RP’s During Implementation
of Resolution Plan

116. Implementation and

supervision of repayment
plan
1. The resolution • Resolution Professional • To determine the
professional appointed ensure that if the consequences
under section 97 or under Adjudicating Authority has in case of non-
section 98 shall supervise approved the repayment implementation of
the implementation of the plan under section 114 will Repayment Plan
repayment plan. implemented effectively effectively.
as per the direction of AA
2. The resolution • To justify
and plan proposed by the
professional may apply to the futuristic
debtor.
the Adjudicating Authority implementation of
for directions,if necessary, • To determine the the Repayment
in relation to any particular consequences in case Plan in an effective
matter arising under the of non-implementation of and efficient
repayment plan. Repayment Plan effectively manner.
and in timely manner.
may issue directions to • To ascertain the reasonable
the resolution professional prospect of approval
on the basis of an and implementation of
application under sub- Repayment Plan.
section (2).
117. Completion of
repayment plan
1. The resolution • On successful

professional shall implementation of
within fourteen days of repayment plan, resolution
the completion of the professional sent a notice
repayment plan, forward that repayment plan has
to the persons who are been fully implemented
bound by the repayment and a copy of a report by
plan under section 115 the resolution professional
and the Adjudicating summarising all receipts
Authority, the following and payments made
documents, namely - in pursuance of the
repayment plan and extent
(a) a notice that the
of the implementation of
repayment plan
such plan as compared
has been fully
with the repayment plan
implemented; and
approved by the meeting of
the creditors, within 14 days
of completion of repayment
plan.

Role of RP’s During Implementation of Resolution Plan
(b) a copy of a report • In case repayment plan not

by the resolution get completed within the
professional timelines mentioned in the
summarising repayment plan, resolution
all receipts and professional may apply to
payments made in adjudicating authority to
pursuance of the extend the time for such
repayment plan further period not exceeding
and extent of the seven days.
implementation
of such plan as
compared with the
repayment plan
approved by the
meeting of the
creditors.
2. The resolution
professional may apply to
to extend the time
mentioned in sub-section
(1) for such further period
not exceeding seven
days.

118. Repayment
plan coming to end
prematurely
1. A repayment plan shall • Where the repayment

be deemed to have come plan comes to an end
to an end prematurely prematurely, either in
if it has not been fully case it has not been fully
implemented in respect implemented in respect
of all persons bound of all persons bound by
by it within the period it within the period as
as mentioned in the mentioned in the repayment
repayment plan. plan or successful
implementation of
2. Where a repayment
repayment plan before the
plan comes to an end
timelines mentioned in the
prematurely under this
repayment plan, then in that
section, the resolution
case resolution professional
professional shall
shall submit a report to
submit a report to the
which shall state:
which shall state-
(a) the receipts and
(a) the receipts and payments made in
payments made in pursuance of the
pursuance of the repayment plan;
repayment plan;
(b) the reasons for
(b) the reasons for premature end of the
premature end of the repayment plan; and
repayment plan; and
(c) the details of the
(c) the details of the creditors whose claims
creditors whose claims have not been fully
have not been fully satisfied.
satisfied.
3. The Adjudicating
Authority shall pass an
order on the basis of the
report submitted under
sub-section (2) by the
that the repayment plan
has not been completely
implemented.
4. The debtor or the creditor,
whose claims under
repayment plan have not
been fully satisfied, shall
be entitled to apply for a
bankruptcy order under
Chapter IV.


shall forward to the
persons bound by the
repayment plan under
section 115, a copy of
the -
(a) report submitted by the
to the Adjudicating
Authority under sub-
section (2); and
(b) order passed by the
under sub-section ( 3) .
shall forward a copy of
the order passed under
subsection (4) to the
Board, for the purpose
of recording entries in
the register referred to in
section 196.
119. Discharge order
1. On the basis of the • On completion of
repayment plan, the repayment plan or early
resolution professional discharge if mentioned
shall apply to the in the repayment plan,
Adjudicating Authority resolution professional
for a discharge order shall apply to adjudicating
in relation to the debts authority for a discharge
mentioned in the order in relation to the
repayment plan and the debts mentioned in the
Adjudicating Authority repayment plan.
may pass such discharge
• As per Reg. 21 of IBBI
order.
(Insolvency Resolution
2. The repayment plan may Process for personal
provide for - guarantor to the Corporate
Debtors) Regulations, 2019,
(a) early discharge; or
(b) discharge on complete shall for the purpose of
implementation of the discharge order, file an
repayment plan. application along with the
3. The discharge order copies of the notice and
shall be forwarded to the report under section 117
Board, for the purpose of IB Code, 2016, to the
of recording entries in adjudicating Authority under
the register referred to in Section 119.
section 196.
4. The discharge order
under sub-section (3)
shall not discharge any
other person from any
liability in respect of his
debt.

120. Standard of conduct

The resolution professional • Resolution Professional
shall perform his functions shall abide by the following
and duties in compliance code of conduct: –
with the code of conduct (a) to take reasonable care
provided under section 208. and diligence while
performing his duties;
(b) to comply with all
requirements and
terms and conditions
specified in the byelaws
of the insolvency
professional agency of
which he is a member;
(c) to allow the insolvency
professional agency to
inspect his records;
(d) to submit a copy of
the records of every
proceeding before the
to the Board as well
as to the insolvency
professional agency of
which he is a member;
and
(e) to perform his functions
in such manner
and subject to such
conditions as may be
specified.

List of Exceptional Scenarios &
Suggested Sop’s
Identify and Validate excluded Assets U/s. 79(14)
Unencumbered • For employment/ business/ vocation As are necessary for the purpose of his
Tools/books/ • For Eg., Apple laptop/desktop Whether employment/vocation. So,
Vehicles essential
• Validate, whether the listed out tools are
• High Cost business Softwares/Apps necessary for employment/business /
etc., vocation.
• Apple I Phone – Whether essential • If so, identify the nature and volume of
income generated in the past 3 years and
• Old Books of commercial /Antique value
the potential for generating income for
• Audi/Benz/BMW Car or Maruti Car next 3 years.
• Imported/ Hi Value Two wheelers • For Eg., Desktop/laptop used by
• Antiques professionals for professional drawing/with
specific professional application - can be
• Intellectual property Rights? exmpt.
• Royalty? • Otherwise, used for entertainment can not
be considered necessary.
• To be treated as Assets available for
distribution
• Intellectual property rights - Validate from
IPR Website -
• IBBI has to come out with guidance on the
NATURE and quantum of permitted tools
Unencumbered • For Satisfying basic needs of the family. • Basic Needs and Basic standard to be
Furniture/ specified by IBBI/Govt.
• Home Theatre/wi-fi enabled hi-tech
household devices • Antiques are different class and hence can
equipments not be left to the Defaulted Individual.
• Cozy Sofa/bed, Jacuzzi, Other posh
devices • Antiques are taken over and to be treated
as available for distribution.
• Antiques display
• Similarly Jacuzzi/Cozy bed etc.,
Personal • Mangal sutra over more than 10 • 79(14)(c) states “as may be prescribed”.
ornaments of Soverigns
• Once the Govt/IBBI prescribes the
such value, • Other attached ornaments with Mangal minimum weightages, then the difference
which cannot Sutra which they claim as part of can be taken over. It is now prescribed
be parted with, mangal sutraHigh Cost ornaments that up to Rs.1 lakh (Rule 5)
as per religious worn regularly, claimed to be part of the
usage.. • As per the religious requirements,
religious requirements
the additional ornaments have to be
evaluated.
• Help of “Registered Valuer” can be taken

List of Exceptional Scenarios & Suggested Sop’s
Unencumbered • Hi Value Insurance Policy • Policy need to be evaluated for its

Life Insurance unencumbered – Can it be part of expected benefits.
policy and source for repayment?
• Where the expected benefit is in excess
pension plan • Pension plan of more than prescribed of the basic requirement for maintaining
value – can it be part of source for the family
repayment plan?
• Whether keyman proceeds to be payable
• Keyman Insurance Policy to the CD or to the Individual. Policy
details to be validated
Unencumbered • Single dwelling unit – means what? – • Definition of Single Dwelling unit to be
Single dwelling Flat with single bedroom validated – Now it is prescribed Rs. 10
unit lakhs in Rural Area and Rs. 20 lakhs in
• Multiple flats joined together as single
Urban area. (Rule 5)
flats
• Dwelling unit for Self and dependents to
be validated
• Specific size to be notified by IBBI
• In GST, there is a concept of “affordable
housing”. Whether the area as per
“affordable housing” can be a single
dwelling unit? Need Clarification from
authorities.
• Multiple flats joined together can not be
a single dwelling unit. However, official
clarification has to be issued by IBBI in this
regard
1. Excluded Debts – Sec. 79(15):
Court fine / • Whether penalty on the Civil Side/ • Official clarification on penalties of CD
Criminal Side devolved on the Individual / penalties on
penalty
cases against individual to be clarified
• Whether compoundable offence
• Whether Court fine/penalty levied on
• What is the priority
defaults of CD payable by director .. Eg.,
in PF, the personal liability attached to the
employer for failure of the CD, whether
covered
• Or Penalty/fine levied on Cases against
specific individual
• Where punishment like imprisonment
compounded by Financial penalty covered
Damages for • Cheque bounce cases • Individual cases to be validated on the

Statutory/ following attributes on meeting excluded
• Where compounding/settlement is
contractual debts
possible
or other legal • Damages not charged to any asset
obligation
Results of • Damages not related to individual case
failure to pay • Damages not related to CD case
damages –
Impact?

Maintenance • Maintenance paid to parents, by custom • If not mandated by law then not excluded
to any person not by law debt
under any law • Maintenance paid to Disabled relative – • If mandated by contract, verify whether
in force not legally dependant contract is voidable on Insolvency/
bankruptcy
• Mandated by custom, not enforceable
Student loan • Student loan for self and dependant • Unless excluded specifically student loan
children cover both for self as well as dependant
children
• Student loan for sponsored children
• For sponsored children, not covered – can
be claimed along with regular debt.
2. Immediate family – Sec. 79(17)
• Parents living with the Individual, • No condition that the parents to live with
the individual
• Parents living with other siblings
• Parents not dependant – not covered
• Parents having own pension/source of
income • Parents under resolution plan and/or
bankruptcy also covered under Immediate
• Parents under Resolution plan
family. But parents’ debt not covered in
• Parents under bankruptcy this proceedings.
3. Qualifying Debt – Sec. 79(19)

Qualified Debt  A liquidated sum – Means  Debt should have been crys-
debts should have been tallized, either by adjudication
determined or otherwise
Guarantees • Guarantees for Company Debt • Guarantees when invoked, become

crystallized
• Guarantees for other personal debts
• Guarantee not covered by specific security
• Personal Guarantee without specific
interest – unsecured claim
assignment of any property
• Enforceability of Guarantee
Unsecured Debt • Except - Secured Debt – What is • Security interest should have been created
secured debt – How to validate creation by any legal means like Charge, mortgage
of security interest- undocumented etc.,
security interest creation by word of
• Undocumented security interest by word of
mouth – possession of property without
mouth can not be validated.
evidence of having been given as
security • Possession given has to be redeemed.
4. Interim Moratorium
• Is it applicable even to the specifically • Sec. 96(1) (a) states in relation to “all
charged asset? Secured debts are not the debts” and (b) states proceedings in
qualifying debt. respect of “any debt”.

5. Individual in Real Estate Business:
• Claim of allottees – Financial creditor? • There is no differentiation between the

Any priority? creditors in the individual insolvency
• Claim of JV land holder • Verify the individual documents on the
basis of which claim made and validate
• Claim of JV land holder on the
the claim
realization from UDS of JV Land.
• JV land holder is a Joint Venturer. Validate
• Claim of Bank on the hypothecated JV
whether he is part of the Venture itself.
property
If so, no separate claim. If not, only as
• Sale of land in normal course of an investor of property for the business,
business or Sec. 43? validate the same and admit claim.
• Hypothecated JV property – to the extent
of the share of the Developer is the
property of the Individual – To Validate and
admit claim
• Sale of land in normal course – to validate
with agreements and other documents
w.r.t. to time, place, value, rate and other
conditions
6. Exception in Claims
• Recently created Debt for repayment of • Recently created – how created –

another Debt – Preferential treatment? document to be validated
Exceptionally high value debt
• If for repayment of other debt – whether in
disproportionate to asset
normal course or prepayment to determine
• Exceptional losses reported Preference
• Gambling/Other Speculative Debts • High Value debt – Usury interest to
validate
• Doubtful encumbrances created over
assets • For the Debt contracted through an
enforceable valid law of the land only
• Claims of HUF, in which the Individual is
claim can be raised. Gambling and
Karta/Not a karta
speculative transaction debt to be
• Time barred debt/claim – only oral validated whether it is in compliance with
confirmation on renewal of debt the laws of the land.
• Encumbrances to be validated with the
respective registering authority. If not
registered can not be recognized
• Claim of HUF – in relation to nature,
purpose, validity, contract to be validated
for admission. Even if admitted shall be
related party claim only
• Limitation act applies. If time barred –
cannot be admitted. Renewal/ack of debt
to be validated with documentary evidence
7. Exception in Assets:
• Unauthorisedly confiscated goods (For • Validate ownership of goods. Confiscation

Eg., vehicles taken over- with charge/ during moratorium is not permissible.
without charge) – Other Assets taken Reclaim the goods
over
• Purchase at exorbitant value
• Recently bought assets at Exorbitant disproportionate to market value, can be
value disproportionate to market value covered U/s. 43 and reclaim the payment

• Difference in perception over the value • Appointment of approved valuer shall

of assets address
• Not Easy to liquidate/realize Asset – • NRNR assets, the same procedure
encumbrance created as applicable to Corporate Liquidation
process
• Related party encumbrances on the
assets • Encumbrances to be validated with
appropriate documents. Registration with
• Possession in the hands of related
the Authorities to be validated.
party for dubious debts – Father in law
refusing to hand over land claiming the • Dubios debts, to validate with claim paper.
rights of the Grand children Re-claim possession through application
to AA
• Hereditary property
• Family property – Arrive at the pro-rata
• Rights of legal heirs over hereditary
entitlement as per the law and claim the
property
same and include in the List of assets
• Rights of legal heirs over self acquired
• From Hereditary property pro-rata eligible
property
claim as per law to taken to the list of
• Self acquired property shown as HUF Assets
Property
• Right of legal heir not disturbed by the
• Share in HUF property Individual’s insolvency
• Property under lease with third party • Self – Acquired property of the individual
• Property with rights for enjoyment only/ shall be covered in the list of asset and
without right to sell – For Eg. Rental the balance of the property after meeting
income enjoyed but no right to sell. all the liabilities can be transmitted to legal
Whether future rent can be capitalized heir
and valued? • Share in HUF property shall form part of
• Valuable lease hold rights of commercial the list of Assets of the individual
property • Property under lease with third party
shall be part of the list of Asset. However,
advance paid for the lease shall form part
of the claim of the lessee
• The right for enjoyment has to be
evaluated and value is to be arrived at by
the Regd. Valuer to include the same in
the list of assets
• Value of lease hold rights to be evaluated
and valued by the Regd. Valuer for
inclusion in the list of assets
8. Exceptions in Creditors meeting:
• Non Cooperative Creditor – minority • RP is the chairman of the meeting and

disrupting the meeting is empowered to discipline the non
cooperative creditor and conduct the
• Non Cooperative Creditor – Majority
meeting
• Creditor posing personal threat to
• Majority Non cooperative creditor – try to
Individual – manhandling by Creditors
reason out and obtain cooperation, failing
• Collection Agency of some of the which apply to AA for direction
Creditors
• RP entitled to seek and obtain protection
for both himself and the Individual
Guarantor also

• Creditor using foul languages to receive • Moratorium covers the activities of the
the money from the Individual Collection agency also
• Rights of the Individual for protection • RP is empowered to discipline the Creditor
or seek direction from the AA
• Individual has the right of protection. He
needs to apply to AA
9. Other Exceptions
• Medical emergency of Individual or • Medical emergency need to be address

Immediate family during the process– and the assets/funds used shall be
Expenses how to bemet treated as legitimate expenses. However,
appropriate documentation to be obtained
• Functions in the immediate family /
by RP
individual
• RP has no role on the functions in the
• Theft of assets of the individual during
family. To ensure that the list of Assets
the process
declared is not impaired by the functions
• Loss of assets by the individual during
• Theft of assets/ loss of assets have to be
the process
recognized and list has to be appropriately
impaired. However, proper documentation
on the same to be obtained by RP and
to be reported to the AA in the Progress
Report
• Contingency claim materializing • Contingency crystallaisation has to be

validated by the appropriate document
• Accidents during the process – damage
and value to be frozen with the help of
to property and damage to third party
professionals of the related field also
• Damage to property due to accidents – to
be recognized and to be appropriately
documented
• Damages to third party shall form part of
the list of claims

Appendices
a) Annexure A - Specimen of RPs’ report to AA u/s 99
b) Annexure B – Specimen of Public Notice of RP u/s 102
c) Annexure C - Specimen of List of Creditors u/s 104
d) Annexure D - Specimen of RP’s report on Repayment plan u/s 106

Appendices
APPENDIX – A
BEFORE THE NATIONAL COMPANY LAW TRIBUNAL
AT _________ – BENCH ___
CP/(IB)/……(…….)/…..
In the matter of Insolvency and Bankruptcy Code, 2016
And
……………............
……………............
……………............Applicant
Vs
……………............
……………............
……………............
……………............Respondent
a) Details of the Resolution Professional
Name : ………………………
IBBI Reg.No. ……………………….
Address ---------------------------------
Contact Mail …………………………….
Mobile ………………..
b) Address for Service of Notice and Processes on the Resolution Professional:
…………....…............
……………................

Appendices
REPORT FILED BY THE RESOLUTION PROFESSIONAL

U/S 99 OF INSOLVENCY AND BANKRUPTCY CODE 2016
1. [narrate details of the CIRP / Liquidation of the related Corporate Debtor].
2. It is submitted that, in the hearing held on ……………, the Hon’ble NCLT

Passed an order for appointing me as Resolution Professional u/s 97 of IBC
2016 and intimation and copy of said order has been received through email
on ……….. As per the order, I have been directed to submit Report u/s 99 of
the IBC 2016 and accordingly the report of Resolution Profession is submitted.
A Copy of the said order is annexed herewith as Annexure – 1.
3. It is submitted that, the Application u/s 95 (1) of IBC, 2016 has been filed
by the Creditor and to submit the Report u/s 99 and I have examined the
application and ascertained the Satisfaction of requirements set out in Section
95 as under :
Section Observation of the

Resolution Professional
95(1) A creditor may apply either by himself, [narrate all the observations
or jointly with other creditors, or in detail. Enclose all the
through a resolution professional to the supporting documents as
Adjudicating Authority for initiating an appropriate annexures]
insolvency resolution process under this
section by submitting an application.
95(2) A creditor may apply under sub-section
(1) in relation to any partnership debt
owed to him for initiating an insolvency
resolution process against—
(a) any one or more partners of the firm;

or
(b) the firm.
95(3) Where an application has been made

against one partner in a firm, any other
application against another partner
in the same firm shall be presented
in or transferred to the Adjudicating
Authority in which the first mentioned
application is pending for adjudication
and such Adjudicating Authority may
give such directions for consolidating
the proceedings under the applications
as it thinks just.

Appendices
95(4) An application under sub-section (1)

shall be accompanied with details and
documents relating to—
95(4)(a) the debts owed by the debtor to the

creditor or creditors submitting the
application for insolvency resolution
process as on the date of application;
95(4)(b) Failure by the debtor to pay the debt

within a period of fourteen days of the
service of the notice of demand; and
95(4)(c) The failure by the debtor to pay the debt

within a period of fourteen days of the
service of the notice of demand; and
95(5) The creditor shall also provide a copy of

the application made under sub-section
(1) to the debtor.
95(6) The application referred to in sub-

section (1) shall be in such form and
manner and accompanied by such fee
as may be prescribed.
95(7) The details and documents required

to be submitted under sub-section (4)
shall be such as may be specified.
4. It is submitted that, as provided in Section 99(6)(b) of IBC 2016, the applicant

has provided information and given explanation sought by me u/s 99(4) except
the record of ………………... . The applicant has evidenced that the balance
outstanding of Rs ……………… as on ………. and no repayment received
from the ………….., Personal Guarantors after issue of Demand Notice in
Form – B [Enclosed as Annexure – ….]
5. It is submitted that, I have also sent a letter to the Personal Guarantor

…………. S/o, D/o, W/o ………… on ……….. requesting to provide the proof
for repayment of dues as provided u/s 99(2) of IBC 2016 and no reply received
as on date of the report. The Copy of the Letter attached herewith as Annexure
– …..

Appendices
6. It is submitted that, in view of the reasons recorded in para 3,4 & 5 of this report,
I hereby recommend for the acceptance of the application No. CP(IB)/……
(…)/20… filed u/s 95(1) of the IBC 2016 by the Creditor …………. to initiate
Insolvency Resolution Process against Personal Guarantor ……………….
of the Corporate Debtor M/s …………… and the Adjudicating Authority may
appropriate order u/s 100 of IBC, 2016 for admission of the application.
Place: …………
Date: …………….
Name of the RP: _________________
IBBI Reg.No._________________
AFA Valid upto _________________

Appendices
APPENDIX - B
PUBLIC NOTICE
(Under Section 102 of the Insolvency and Bankruptcy Board Code, 2016)
FOR THE ATTENTION OF THE CREDITORS OF [NAME OF PERSONAL

GUARANTOR]
Relevant Particulars
1. Name of Personal Guarantor [PG]
2. Address of the registered office / principal office /
Residence of PG
3. Details of Order of Adjudicating Authority
4. Date of commencement of Insolvency Resolution Process
5. Name and registration number of the Resolution

professional
6. Address and e-mail of the Resolution professional, as
registered with the Board
7. Address and e-mail to be used for correspondence with the
Resolution professional
8. Last date for submission of claims
Notice is hereby given that the Adjudicating Authority [NCLT (____) / DRT (_______)]
has ordered the commencement of a insolvency resolution process of [name of PG] on
[insolvency commencement date] u/s 100.
The creditors of [name of the PG], are hereby called upon to submit their claims with
proof on or before [insert the date falling 21 days from the date of issue] to the resolution
professional at the address mentioned against entry No. 7.
Submission of false or misleading proofs of claim shall attract penalties.
Name and Signature of Resolution Professional :
AFA Validity Date :
Date and Place : :
Note:
• This notice to be published in at least one English and one vernacular
newspaper which is in circulation in the state where the debtor resides.
• affixed in the premises of the Adjudicating Authority; and
• placed on the website of the Adjudicating Authority

Appendices
APPENDIX – C
In the Matter of Individual Insolvency Resolution Process of Shri./Smt.

____________________
[IRP commencement order no. ________ Dt.________]
List of Creditors
[Prepared under Section 104 of Insolvency and Bakruptcy Code 2016]
Revision No. ____
S. No Name of the Creditor

Date Details of Claim
Amount Claimed Received
Amount disclosed in the application [Sec 94 / 95]
Amount Admitted
Nature of Claim
Amount Covered by Security Interest
Details of Security Interest Details of Claim
Amount Covered by Guarantee Admitted
Whether Related Party

Whether Security Interest Relinquished
% of voting share in Creditors meeting
Amount of Contingent Claim
Amount of Claim Rejected
Amount of Claim under verification
Remarks (if any)
Note: The claims received upto _____ are verified and updated.
Name of the RP: _________________

IBBI Reg.No.__________________
AFA Valid upto ________________

Appendices
APPENDIX - D
BEFORE THE NATIONAL COMPANY LAW TRIBUNAL
AT _________ – BENCH ___
CP/(IB)/……(…….)/…..
In the matter of Insolvency and Bankruptcy Code, 2016
And
……………............
……………............
……………............Applicant
Vs
……………............
……………............
……………............
……………............Respondent
a) Details of the Resolution Professional
Name : ……………….............………
IBBI Reg.No. ……………….............………
Address ……………….............………
Contact Mail ……………….............………
Mobile ……………….............………

Appendices
REPORT FILED BY THE RESOLUTION PROFESSIONAL

ON REPAYMENT PLAN
U/S 106 OF INSOLVENCY AND BANKRUPTCY CODE 2016
1. [narrate details of the CIRP / Liquidation of the related Corporate Debtor].
2. [narrate details of the Individual insolvency commencement process [order of

appointment of RP, Report of RP, order of AA commenceing IRP etc.,]
3. [narrate the details of public notice, claim processed, list of creditors etc.,]
4. It is submitted that, in compliance with the Sec 105 of Insolvency and

Bankruptcy code 2016 read with Regulation 17 of Insolvency and Bankruptcy
Board of India (Insolvency Resolution Process for Personal Guarantors to
Corporate Debtors) Regulations, 2019, a repayment plan has been received
from the Personal Guarantor Shri./Smt._________ on ________ along with
affidavit and other documents.
5. I have perused the detailed repayment plan to ascertain its compliance with the
IBC Code & related regulations as amended from time to time, reasonableness
of its prospects.
6. As per the requirements of Section 106 of IBC, I have prepared this detailed
report on the repayment plan,
7. Compliance with the Provisions of any Laws [Sec 106(2)(a)]
S.No. Applicable Laws with Compliance Status of Compliance

Section reference Requirement along with Remarks
1 Insolvency Law …. ….
2 Contract Law ….. …..
3 Direct Taxes ….. …..
4 Indirect Taxes …. ….
5 Labour Laws …. ….
6 Statutory Registration …. ….
and Compliance
related laws
7 ….. ….. …..
8 …. …. ….
9 …. …. ….
10 …. …. ….

Appendices
14. Compliance to Mandatory Contents of Repayment Plan [Sec 105]
Sec. Requirements of Section Compliance [clause

Ref. reference]
105(1) Repayment plan contains a proposal to the ……
creditors for restructuring of his debts or affairs
105(2)(a) The repayment plan authorise or require the ……

resolution professional to carry on the debtor’s
business or trade on his behalf or in his name
105(2)(b) The repayment plan authorise or require the ……
resolution professional to realise the assets of
the debtor
105(2)(c) The repayment plan authorise or require the
resolution professional to administer or dispose
of any funds of the debtor
105(3)(a) The repayment plan provides for justification
for preparation of such repayment plan and
reasons on the basis of which the creditors
may agree upon the plan
105(3)(b) The repayment plan makes appropriate
provision for payment of fee to the resolution
professional
105(3)(c) The repayment plan such other matters as [Refer the detailed
may be specified compliance report
of regulation
requirements in
clause ___ below]
15. Compliance to Mandatory Contents of Repayment Plan [Reg 17(1)]
Reg. Ref. Requirements of Regulation Compliance

[clause reference]
17(1)(a) the term of the repayment plan and its ……
implementation schedule, including the
amounts to be repaid and dates of repayment
to creditors;
17(1)(b) the source of funds that will be used to ……

pay resolution process costs and that such
payment shall be made in priority over any
creditor

Appendices
17(1)(c) a minimum budget for the duration of the ……

repayment plan, to cover the reasonable
expenses of the guarantor and members of
his immediate family to the extent they are
dependent on him, provided that at least ten
percent of the realisable income of the guarantor
shall be utilised for repayment of debts
17(1)(d) financing required for implementation of the
repayment plan
17(1)(e) if the guarantor has any business, the manner
in which it is proposed to be conducted during
the course of the repayment plan, and the role
of the resolution professional
17(1)(f) the manner in which funds held for the
purposes of the repayment plan, invested or
otherwise dealt with, pending repayment to
creditors
17(1)(g) the functions which are to be undertaken by the
resolution professional, including supervision
and implementation of the repayment plan
17(1)(h) variation of onerous terms of a contract or
transaction involving the guarantor
17(1)(i) the details of excluded assets and excluded
debts of the guarantor
17(1)(j) terms and conditions for the discharge of the

guarantor
16. Compliance to Recomendatory Contents of Repayment Plan [Reg 17(2)]
Reg. Ref. Requirements of Regulation Compliance [clause

reference]
17(2)(a) transfer or sale of all or part of the assets ……
of the guarantor along with the mode and
manner of such sale
17(2)(b) administration or disposal of any funds of ……
the guarantor
17(2)(c) satisfaction or modification of any security ……
interest
17(2)(d) reduction in the amount payable to
creditors

Appendices
17(2)(e) curing or waiving of any breach of a debt

due from the guarantor
17(2)(f) modification in the terms of repayment of
any debt due from the guarantor
17(2)(g) part of the income of the guarantor to be
used for the repayment of the debt, and
the manner of calculating the income of
the guarantor
17(2)(h) the manner in which funds held for the
purpose of repayment to creditors, and
not so repaid at the end of the repayment
plan, are to be dealt with
17(2)(i) such other matters as may be required by
the creditors
………………….
…………………..
17. Prospects of the Repayment Plan [Sec 106(2)(b)]
S.No. Nature of Approvals Required Possibility of getting approval /

for plan implementation Remarks if any
1 ……. ……
2 …… ……
3 …… ……
18. It is submitted that, the assets are not purchased by any person as specified
under regulation 18 of Insolvency and Bankruptcy Board of India (Insolvency
Resolution Process for Personal Guarantors to Corporate Debtors) Regulations,
2019.
[OR]
It is submitted that, the following assets are purchased by the list of persons
covered under Regulation 18 of Insolvency and Bankruptcy Board of India
(Insolvency Resolution Process for Personal Guarantors to Corporate
Debtors) Regulations, 2019 with the specific approval of Adjudicating Authority
as detailed hereunder:
19. It is submitted that, the meeting of the creditors need to be summoned to

discuss and vote on the repayment plan for the following Reason [in compliance
with Section 106(2)(c) of Insolvency and Bankruptcy Code 2016 and the said
meeting is scheduled on __th day of _____ 20___ at ___[place]____ on _____
[time]______.

Appendices
[OR]
It is submitted that, the meeting of the creditors not required to be summoned

for discuss and vote on the repayment plan for the following Reason [in
compliance with Proviso to Section 106(2)(c) of Insolvency and Bankruptcy
Code 2016:
Brief note of impact of the repayment Reason for holding / not-holding

plan to the creditor creditors meeting
20. It is submitted that, in compliance with the requirements of IBC, I have received
all the required details from ……[PG]……. [including latest state of affairs]
except the following documents …………………….
21. It is submitted that the Repayment plan complies with the requirements of
IBC on overall terms, more specifically into all compliance requirements as
tabulated above in this report and can be taken up for appropriate consideration
for voting / approval suitably.
[OR]
It is submitted that the Repayment plan does not complies with the requirements
of IBC on overall terms, more specifically into specific compliance requirements
as tabulated above in this report and can be decided upon suitably by respective
authorities.
Place: …………...............
Date: …………................
Name of the RP: ___________________
IBBI Reg.No.___________________
AFA Valid upto ___________________

Indian Ins tute of Insolvency Professionals of ICAI (IIIPI)
(A Sec on 8 Company & Wholly Owned Subsidiary of ICAI and Registered as an IPA with IBBI)
Regd. Oﬃce: Post Box No: 7100, ICAI Bhawan, Indraprastha Marg, new Delhi - 110002
Admin. Oﬃce: ICAI Bhwan, 8th Floor, Hostel Block, A-29, Sector-62, Noida - 201309
Phone: +91 120 2990080, 2990081, 2975682, 2975683 Email: ipa@icai.in, Website: www.iiipicai.in

IIRP - IIIPI Best Practices

Uploaded by

Copyright:

Available Formats

IIRP - IIIPI Best Practices

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

IIRP - IIIPI Best Practices

Uploaded by

Copyright:

Available Formats

Best Practices on

Individual Insolvency under IBC, 2016

Indian Institute of Insolvency Professionals of ICAI (IIIPI)

Published in: November 2022

Copyright © Indian Institute of Insolvency Professionals of ICAI (IIIPI)

Date: November 25th 2022 Dr. Ashok Haldia,

Best Practices on Individual Insolvency under IBC, 2016 iii www.iiipicai.in

The Study Group constituted by the Indian Institute of Insolvency Professionals

M. Suresh Kumar IP Durgesh Kabra, IP P. K. Diwakar, IP

Date: November 25th, 2022

Best Practices on Individual Insolvency under IBC, 2016 v www.iiipicai.in

Overall structure of Code 5

Organisation of Sections of Part III 5

Related Rules & Regulations [notified upto 30.06.2022] 8

Adjudicating & Appellate Authority 9

4. Overall Flow of the Individual Insolvency Resolution Process 10

6. Relevant Legal Extracts – “Guarantee” / “Guarantors” 12

7. Key Case Laws 15

8. Difference Between Corporate Insolvency & Individual Insolvency’s 20

9. Difference Between Corporate Liquidation & Individual Bankruptcy 21

10. Role of RP’s During Initiation of Individual Insolvency Resolution

11. Role of RP’s During Claim Processing / Admission / List of Creditors 33

13. Role of RP’s During Implementation of Resolution Plan 48

14. List of Exceptional Scenarios & Suggested Sop’s 53

Best Practices on Individual Insolvency under IBC, 2016 vii www.iiipicai.in

CIRP Corporate Insolvency Resolution Process

DRT Debt Recovery Tribunal

DRAT Debt Recovery Appellate Tribunal

IBBI Insolvency and Bankruptcy Board of India

IBC / Code Insolvency and Bankruptcy Code 2016

ICA Indian Contract Act, 1872

ICAI Institute of Chartered Accountants of India

IIIP-ICAI Indian Institute of Insolvency Professionals of ICAI

IPA Insolvency Professional Agency

IRP Interim Resolution Professional

NCLT National Company Law Tribunal

NCLAT National Company Law Appellate Tribunal

Best Practices on Individual Insolvency under IBC, 2016 1 www.iiipicai.in

• Identifying common and divergent practices in an Individual insolvency

Best Practices on Individual Insolvency under IBC, 2016 3 www.iiipicai.in

Members of Study Group:

Best Practices on Individual Insolvency under IBC, 2016 4 www.iiipicai.in

Overall structure of Code

Organisation of Sections of Part III

Best Practices on Individual Insolvency under IBC, 2016 5 www.iiipicai.in

109 Voting rights in meeting of creditors.

Best Practices on Individual Insolvency under IBC, 2016 6 www.iiipicai.in

140 Disqualification of bankrupt.

Best Practices on Individual Insolvency under IBC, 2016 7 www.iiipicai.in

172 Proof of debt.

Related Rules & Regulations [Updated Upto 30.06.2022]

1. The Insolvency and Bankruptcy (Application to Adjudicating Authority

2. The Insolvency and Bankruptcy (Application to Adjudicating Authority

Best Practices on Individual Insolvency under IBC, 2016 8 www.iiipicai.in

1. The Insolvency and Bankruptcy Board of India (Insolvency Resolution

2. The Insolvency and Bankruptcy Board of India (Bankruptcy Process for

Adjudicating & Appellate Authority

Debt Recovery Tribunal (DRT) - Section 179

Debt Recovery Appellate Tribunal (DRAT) -Section 181

Section 60 Sub-section (2), (3) & (4)