By S&S Co. Advocates & Solicitors · Published 22 January 2026 · Informational content, not legal advice
About this article: A general explainer prepared by S&S Co. Advocates & Solicitors on a recurring type of dispute. It does not report a specific judgment or order, names no parties and gives no case citation, so it should not be cited as authority. Law and practice change; please verify against the current statute and primary sources before relying on it.
The Insolvency and Bankruptcy Code, 2016 deals with each corporate debtor separately and has no express provision for substantive consolidation, meaning the treatment of the assets and liabilities of related companies as one pool. Adjudicating authorities have, in a few exceptional cases such as the Videocon group, directed consolidation in the exercise of their inherent powers, but the relief is not granted as a matter of course.
The general approach is that each company's separate legal identity is respected. Common promoters, overlapping directors and some intercompany transactions are not enough. A party seeking consolidation is expected to show that the group companies operated as a single economic unit, with assets and liabilities so commingled that they cannot practically be separated, and that consolidation would be fairer to creditors as a whole.
Where consolidation is refused, the resolution processes continue separately, and the resolution professionals can still coordinate on matters of common interest, such as realising value from group assets. Creditors may also look at avoidance provisions and the conduct of the corporate debtor's management in each process.
Key Points
- The Code treats each company separately and has no express consolidation provision.
- Consolidation has been ordered only in exceptional cases of a single commingled economic unit.
- Resolution professionals can still coordinate on matters of common interest.