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Restructuring and insolvency laws in Delhi, India are designed to address financial distress in businesses and individuals, providing methods for debt resolution and, if necessary, facilitating an orderly winding up. The legal framework is primarily governed by national legislation but applies within the jurisdiction of Delhi through specialized tribunals and courts. The Insolvency and Bankruptcy Code, 2016 (IBC) is the cornerstone law in India for these matters, offering time-bound processes for resolving insolvency of companies, partnership firms, and individuals.
Involvement in restructuring or insolvency processes can be complex and stressful, often involving significant legal risks and financial implications. You may need a lawyer if:
Expert legal guidance ensures compliance with applicable laws, helps protect your interests, and improves the chances of a successful resolution.
While insolvency and restructuring laws are mainly governed by central legislation, their application and enforcement in Delhi have specific considerations:
Understanding the interplay of central and local mechanisms is important for effective resolution.
The IBC is a comprehensive law aimed at consolidating and amending the laws relating to reorganization and insolvency resolution in India. It provides procedures for resolving insolvency for individuals, partnerships, and companies in a time-bound manner.
Creditors (both secured and unsecured) as well as debtors themselves can initiate insolvency proceedings under the IBC. This applies to companies, limited liability partnerships as well as individuals and partnership firms.
The NCLT Principal Bench in Delhi adjudicates on corporate insolvency and restructuring matters arising within its jurisdiction. It handles bankruptcy petitions, settlement approvals, and liquidation orders for companies and LLPs.
The IBC mandates that the corporate insolvency resolution process (CIRP) should be completed within 180 days, with a possible extension of up to 90 days. In exceptional cases, timelines may be further extended by the tribunal.
A resolution professional is an insolvency professional appointed to manage the affairs of the debtor during the resolution process, coordinate with creditors, and prepare a resolution plan or suggest liquidation if resolution is not viable.
Yes, under the IBC, individuals (including sole proprietors and partners in a firm) can file for bankruptcy if they are unable to pay their debts. The procedures are regulated and administered through the Debt Recovery Tribunal in Delhi.
During insolvency proceedings, the powers of the company’s board of directors are suspended and exercised by the resolution professional. Directors are required to cooperate fully with the process or face penalties.
Yes, the company may continue as a going concern during the resolution process, unless the tribunal or resolution professional decides otherwise for specific reasons.
If no resolution plan is approved within the specified period, the company may go into liquidation, meaning its assets will be sold to pay off creditors as per the order of priority set out under the law.
Yes, parties aggrieved by the process or decisions may appeal to the National Company Law Appellate Tribunal (NCLAT) and, subsequently, to the Supreme Court of India on issues of law.
If you are seeking further information or support regarding restructuring and insolvency in Delhi, consider the following resources:
Consulting these bodies or reaching out to a qualified insolvency professional can help clarify your options.
If you believe you need legal assistance for restructuring or insolvency in Delhi, here is how you can proceed:
Early and informed legal advice can make a significant difference in the outcome of your restructuring or insolvency matter.
