By S&S Co. Advocates & Solicitors · Published 22 April 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.
In a corporate insolvency resolution process, the resolution professional receives, collates and verifies claims under Section 18 of the Insolvency and Bankruptcy Code, 2016 and the CIRP Regulations, and keeps a list of creditors. Verification is a function that carries responsibility, and the professional cannot simply accept a claim because the corporate debtor's own books show it.
The need for care is greater where the claimant is connected to the corporate debtor, such as a group company or promoter entity. The books are kept by the debtor's own management, and the arm's-length checks that normally apply to a transaction may be missing. A genuine, properly documented related-party claim can still be admitted, but the professional should look for independent evidence of the underlying transaction.
Related status matters in another way. A financial creditor that is a related party of the corporate debtor is excluded from the committee of creditors and from voting under Section 21(2) of the Code, subject to the exceptions in the proviso. The admission and classification of a related-party claim can therefore affect the composition of the committee and, through it, the outcome of the process.