An application for Insolvency Resolution of a Corporate Person (a Company or LLP) can be filed by –
- Financial Creditors i.e. Banks/Lenders, including any other person to whom debt is legally transferred (e.g. bill discounting, Debt Swap).
- Operational Creditor i.e. a person who sold goods or provided services to the Corporate Debtor (includes worker/employee of that Corporate person).
- Corporate Person itself.
For Corporate Insolvency Resolution Process the Code prescribes a strict timeline of 180 days with one time extension of 90 days.
Am I eligible to file application for Insolvency Resolution of my Corporate Debtor?
In order to file application for Insolvency Resolution of a Corporate Debtor the minimum amount of default is Rs. 1 Lac only.
In case you are a Financial Creditor, you can file insolvency resolution application even if the Corporate Debtor has defaulted in repayment to any other Financial Creditor.
FAST TRACK CORPORATE INSOLVENCY RESOLUTION
The Insolvency and Bankruptcy Code, 2016 prescribes a fast track corporate insolvency process for the entities with less complex structuring or businesses.The Central Government will prescribe the classes of entities based on the assets and liabilities, amount of debt and other criteria, which will be subject to the fast track process.
The fast track insolvency process will be required to be completed within a period of 90 days with a onetime extension of 45 days.
A Corporate Debtor can apply for Voluntary liquidation, provided he has not committed any default.