Insolvency & Bankruptcy in India

Insolvency & Bankruptcy
Presented By:
Registrationwala

What is Insolvency
Insolvency is a state of being where an
entity is not able to repay the debts to
its creditors within the prescribed
time
The insolvent entity/insolvent debtor
can either be a person or a company
If the debtor is a company, then they
are referred to as corporate debtors
The creditors can either be
operational or financial creditors

What is Bankruptcy
Bankruptcy refers to a declaration
of insolvency
It is only after this declaration that
the Insolvency and Bankruptcy
Board of India steps in
Bankruptcy declaration can either
be filed by the debtor or the
creditors
When bankruptcy is declared,
insolvency resolution process is
initiated.

Insolvency In Business
Insolvency in business refers to when a company has gone insolvent.
It is a case when the company is not able to pay operational or financial credit.
When a business goes insolvent, the employees of that business suffer.
Not being able to pay the employees is an example of inability repay
operational credit.

What Happens When A Company
Becomes Insolvent
After a company becomes insolvent, either they or the
operational/financial creditors can file to initiate the
insolvency resolution process.
The form used to file this petition comes under section
9.
If the form is accepted, the insolvency resolution
process initiates.
At the end of the resolution, either the company is sold
or the assets of the power point debtor are liquidated.
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What Is Personal Insolvency
If the insolvent entity is a single person, then it is the case of personal
insolvency.
The matter of personal insolvency is handled by Debt Recovery Tribunal.
Personal insolvency does not take much time to be resolved.
Personal insolvency can lead to the need of personal assets to be liquidated.
Personal Insolvency

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