In Short
The Insolvency and Bankruptcy Code, 2016 (IBC) provides a time-bound process — the Corporate Insolvency Resolution Process (CIRP) — for resolving corporate defaults, administered by the NCLT with appeals to the NCLAT and the Supreme Court. S&S Co. represents creditors seeking to initiate proceedings, debtors defending admission, resolution professionals administering the process, and personal guarantors facing Part III proceedings, from our Noida, Delhi and Kolkata offices.
What Is the IBC?
The Insolvency and Bankruptcy Code, 2016 consolidated India's fragmented insolvency framework into a single, time-bound statute. Where a corporate debtor defaults on a debt above the statutory threshold, a financial creditor, operational creditor, or the debtor itself may apply to the National Company Law Tribunal (NCLT) to trigger the Corporate Insolvency Resolution Process (CIRP). Once admitted, a moratorium freezes all proceedings against the debtor, a resolution professional takes over management, and a Committee of Creditors (CoC) — dominated by financial creditors — evaluates resolution plans within a statutory timeline. If no viable resolution plan is approved, the company proceeds to liquidation.
The IBC also allows insolvency proceedings against personal guarantors to corporate debtors under Part III, and — through repeated Supreme Court jurisprudence — has developed strict jurisdictional and limitation rules that leave little room for procedural laxity on either side.
A notable 2026 development underscores how seriously courts now police the accuracy of what is placed before them in insolvency proceedings: the Supreme Court set aside an NCLT order in the Essel Infraprojects matter after discovering the tribunal's reasoning relied on fabricated, AI-generated case citations, and directed the Bar Council of India to frame verification norms — a reminder that every authority cited in an IBC filing must be genuine and checked against primary sources.
Forums We Appear Before
NCLT — New Delhi Bench
NCLT — Kolkata Bench
NCLAT — New Delhi (Principal Bench)
Supreme Court of India — IBC appeals
Delhi High Court — connected writ matters
Calcutta High Court — connected writ matters
Our IBC & Insolvency Services
- Creditor representation — financial and operational creditors filing Section 7/9 applications to initiate CIRP, and representation on the Committee of Creditors.
- Corporate debtor defence — resisting admission on jurisdictional or limitation grounds, and negotiating settlement before admission under Section 12A.
- Resolution plan advisory — advising resolution applicants, bidders and existing promoters on resolution plan structuring and CoC approval strategy.
- Personal guarantor proceedings — representing guarantors facing Part III insolvency proceedings connected to corporate defaults.
- Liquidation proceedings — representing stakeholders where no resolution plan is approved and the corporate debtor proceeds to liquidation.
- NCLAT appeals — Section 61 appeals from NCLT orders, calendared with strict attention to the 45-day outer limitation.
- Avoidance transaction proceedings — preferential, undervalued, fraudulent and extortionate transaction claims under Sections 43-51 and 66.
The CIRP Process
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Filing & Admission
A Section 7 (financial creditor), Section 9 (operational creditor) or Section 10 (corporate debtor) application is filed before the NCLT; on admission, a moratorium takes effect and an interim resolution professional is appointed.
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Committee of Creditors & Claims
Creditors submit claims, the CoC is constituted based on verified financial debt, and the resolution professional manages the debtor's operations as a going concern.
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Resolution Plan Process
Resolution applicants submit plans, which the CoC evaluates and approves by the requisite voting share, subject to NCLT sanction.
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Approval or Liquidation
An approved plan binds all stakeholders once sanctioned by the NCLT; absent an approved plan within the statutory timeline, the debtor proceeds to liquidation.
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Appeal
Aggrieved parties may appeal NCLT orders to the NCLAT under Section 61, and onward to the Supreme Court on questions of law under Section 62 — both subject to strict limitation.
Illustrative Scenarios
The following are hypothetical, illustrative scenarios prepared for educational purposes. They are not descriptions of actual client matters, and no outcome is guaranteed in any specific case.
Illustrative Scenario
Operational Creditor Pursuing an Unpaid Invoice Through CIRP
A Noida-based supplier is owed a significant sum by a corporate buyer that has stopped responding to demand notices. A well-documented Section 9 application — supported by invoices, delivery proof and an unrebutted demand notice — can trigger CIRP admission where there is no genuine, pre-existing dispute over the debt, giving the creditor real leverage even before a resolution plan is reached.
Illustrative Scenario
Resolution Applicant Structuring a Bid for a Kolkata Manufacturing Company in CIRP
A strategic investor wants to bid for a distressed Kolkata manufacturer undergoing CIRP. Success depends on early engagement with the resolution professional, careful due diligence on avoidance-transaction exposure, and a resolution plan structured to secure the requisite CoC voting share while addressing operational creditors' concerns to avoid downstream challenges.
Illustrative Scenario
Committee of Creditors Divided Over Competing Resolution Plans
Two resolution applicants submit competing plans for a distressed Delhi NCR manufacturing company, and the Committee of Creditors is split on valuation methodology. Independent, defensible valuation evidence presented to the CoC — rather than relying on the resolution professional's initial estimate alone — is often decisive in securing the requisite voting share.
Illustrative Scenario
Personal Guarantor Facing Parallel Proceedings After a Corporate Default
A promoter who personally guaranteed a Kolkata company's loan faces insolvency proceedings under Part III even while the corporate CIRP is ongoing. Understanding that guarantor and corporate debtor proceedings run on largely independent tracks — with separate defences available to each — is essential to avoid conceding liability prematurely in either forum.
Notable Judgments
Supreme CourtJul 2, 2026
Essel Infraprojects — NCLT Order Set Aside for Reliance on AI-Hallucinated Precedents
Supreme Court Sets Aside NCLT Insolvency Order Built on Fabricated, AI-Generated Case Law
The Supreme Court set aside an NCLT order in the Essel Infraprojects insolvency matter after discovering the tribunal's reasoning relied on non-existent precedents generated by an AI tool, and directed the Bar Council of India to frame norms governing the verification of AI-assisted legal research before it is placed before courts and tribunals.
Key Takeaway — Every citation used in NCLT/NCLAT filings — whether drafted with AI assistance or not — must be independently verified against primary sources before filing; unverified AI output is now a sanctionable and case-fatal risk.
Supreme CourtJul 2026
Public Interest Litigation on Bank-ARC Settlements — Notice Issued to Centre & RBI
SC Flags Nexus Between Banks, ARCs and Borrowers Over Steep Haircut Settlements
A bench led by the Chief Justice raised concern over a plea alleging that ₹1,537 crore owed to public sector banks was settled through two asset reconstruction companies for just ₹73.50 crore, and issued notice to the Centre, the RBI, and other respondents. The Court emphasised it was concerned specifically with the mis-utilisation of public money, while noting its limited institutional role in second-guessing the commercial wisdom of banks.
Key Takeaway — Lenders and ARCs should expect closer judicial and regulatory scrutiny of one-time-settlement and asset-sale pricing where public sector money is involved.
Supreme CourtApr 20, 2026
In re: Delays in NCLT Resolution Plan Approvals — AVJ Developers Matter
SC Flags Nearly Two-Year NCLT Delay in Approving Resolution Plans, Seeks Nationwide Data
Hearing a matter arising from the insolvency of AVJ Developers (India) Pvt. Ltd., the Supreme Court expressed serious concern that approval of a resolution plan had remained pending before the NCLT for nearly two years, undermining the Code's time-bound design. The Court directed that nationwide data on pending resolution plan approvals be compiled and placed before it.
Key Takeaway — Systemic NCLT delays are now under direct apex court monitoring — resolution applicants and creditors should factor possible administrative reform into deal timelines.
Supreme Court — Feb 2026Feb 2026
Satinder Singh Bhasin v. Col. Gautam Mullick & Ors. — (2026) ibclaw.in 47 SC
100-Allottee Threshold Under Section 7 Is Fixed at Date of Petition Registration
The Supreme Court held that the statutory threshold of 100 allottees (or 10% of allottees) for a Section 7 petition by homebuyers is to be determined as on the date of registration of the petition, not at the date of hearing or admission, and that substitution of petitioners prior to registration is permissible under the NCLT Rules. Two intrinsically linked and jointly liable real estate companies could also be proceeded against in a single, joint petition.
Key Takeaway — Homebuyer collectives should lock in the requisite threshold at the time of filing — later attrition or substitution of co-petitioners will not defeat an otherwise validly registered petition.
See all Legal Updates for this practice area →
Our Approach to IBC & Insolvency
- Dual-Bench coverage — direct representation before both NCLT Delhi and NCLT Kolkata, avoiding fragmented counsel across benches.
- Deadline discipline — the IBC's limitation framework is unforgiving; we calendar every Section 61/62 deadline with zero margin for error.
- Both sides of the table — experience representing creditors, debtors and resolution applicants gives us a realistic read on CoC dynamics and negotiation leverage.
- Founders with 20 years combined experience across commercial litigation, arbitration and regulatory practice.
Frequently Asked Questions
Who can file for insolvency against a company under the IBC?
A financial creditor, an operational creditor, or the corporate debtor itself, provided the default meets the statutory minimum threshold (currently ₹1 crore).
How long does the CIRP process take?
The IBC prescribes 180 days from admission, extendable by up to 90 days, with an outer limit of 330 days including litigation time — though many cases run longer in practice.
What is the deadline to appeal an NCLT order to NCLAT?
Section 61(2) prescribes 30 days, extendable by a further 15 days on sufficient cause — a strict 45-day outer limit the Supreme Court has confirmed NCLAT cannot condone beyond.
Can a personal guarantor be proceeded against under the IBC?
Yes — personal guarantors to corporate debtors can be subjected to insolvency proceedings under Part III, independently of or alongside proceedings against the principal borrower.