{"id":23014,"date":"2022-08-19T12:34:01","date_gmt":"2022-08-19T07:04:01","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=23014"},"modified":"2022-09-15T15:31:22","modified_gmt":"2022-09-15T10:01:22","slug":"liquidation-process-for-cd-under-ibc","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/","title":{"rendered":"Liquidation Process for Corporate Debtor under IBC"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69dd2c8960a56\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69dd2c8960a56\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Liquidation_Process_for_Corporate_Debtor_under_IBC\" title=\"Liquidation Process for Corporate Debtor under IBC\">Liquidation Process for Corporate Debtor under IBC<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Following_Liquidation_Steps_to_be_followed_under_the_IBC\" title=\"Following Liquidation Steps to be followed under the IBC \">Following Liquidation Steps to be followed under the IBC <\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_1_Appointment_of_Liquidator_Section_34\" title=\"Step 1 : Appointment of Liquidator ( Section 34 )\">Step 1 : Appointment of Liquidator ( Section 34 )<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_II_A_%E2%80%93_Public_Announcement_of_Liquidation\" title=\"Step II \u00a0A &#8211; Public Announcement of Liquidation\">Step II \u00a0A &#8211; Public Announcement of Liquidation<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_II_B-_Claims_Process_in_Liquidation\" title=\"Step II \u00a0B- Claims Process in Liquidation \">Step II \u00a0B- Claims Process in Liquidation <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_IV_Reports_to_be_prepared_by_Liquidator\" title=\"Step IV : Reports to be prepared by Liquidator\">Step IV : Reports to be prepared by Liquidator<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_V_%E2%80%93_Sale_of_Assets\" title=\"Step V &#8211; Sale of Assets\">Step V &#8211; Sale of Assets<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_VI_%E2%80%93_Distribution_of_Assets_as_per_Waterfall\" title=\"Step VI &#8211; Distribution of Assets as per Waterfall\">Step VI &#8211; Distribution of Assets as per Waterfall<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_VII_%E2%80%93_Dissolution_of_Corporate_Debtor_to_be_completed_within_1_year\" title=\"Step VII &#8211; Dissolution of Corporate Debtor (to be completed within 1 year)\">Step VII &#8211; Dissolution of Corporate Debtor (to be completed within 1 year)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Step_VIII_%E2%80%93_Dissolution_Of_CD_under_IBC\" title=\"Step VIII &#8211; Dissolution Of CD under IBC \">Step VIII &#8211; Dissolution Of CD under IBC <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/#Services_in_the_field_of_Insolvency_Laws\" title=\"Services in the field of Insolvency Laws\">Services in the field of Insolvency Laws<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-22719\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/07\/PROCESS-OF-VOLUNTARY-LIQUIDATION.jpg\" alt=\"PROCESS OF VOLUNTARY LIQUIDATION\" width=\"841\" height=\"483\" \/><\/h2>\n<h2><span class=\"ez-toc-section\" id=\"Liquidation_Process_for_Corporate_Debtor_under_IBC\"><\/span><a href=\"https:\/\/www.caindelhiindia.com\/blog\/liquidation-estate-under-ibc\/\"><span style=\"color: #ff0000;\"><strong><u>Liquidation Process for Corporate Debtor under IBC<\/u><\/strong><\/span><\/a><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<ul>\n<li>As per Insolvency and Bankruptcy Code read with Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (with amendments)<\/li>\n<li>Form E of Schedule II, provided by the corporate debtor, must be submitted in person, by mail, or electronically to the liquidator as proof of claim. In accordance with Regulations 17(1), 18(1), or 19(1), the liquidator must receive proof of claim in Form G of Schedule II in person, via mail, or electronically.<\/li>\n<\/ul>\n<h2><span class=\"ez-toc-section\" id=\"Following_Liquidation_Steps_to_be_followed_under_the_IBC\"><\/span><span style=\"color: #ff0000;\"><strong><u>Following Liquidation Steps to be followed under the IBC <\/u><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><strong>Step-I <\/strong><strong>&#8211; <\/strong>Appointment of liquidator and consequences<\/p>\n<p><strong>Step-II &#8211; <\/strong>Announcement of Liquidation and Calling for Submission of Claims and Appointment of Valuers<\/p>\n<p><strong>Step-III<\/strong><\/p>\n<ol>\n<li>Verification and Acceptance of Claims<\/li>\n<li>Preparation of Asset Memorandum and Other Reports<\/li>\n<\/ol>\n<p><strong>Step-IV<\/strong><strong>&#8211; <\/strong>Formation of liquidation estate (With Inclusions and Exclusions)<\/p>\n<p><strong>Step-V<\/strong> &#8211; Sale of Assets<\/p>\n<p><strong>Step-VI <\/strong><strong>&#8211; <\/strong>Distribution of Assets as per Waterfall<\/p>\n<p><strong>Step-VII <\/strong><strong>&#8211; <\/strong>Dissolution of Corporate Debtor (to be completed within 1 year)<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-23016\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/08\/Liquidation-Process-for-Corporate-Debtor-under-IBC..jpg\" alt=\"Liquidation Process for Corporate Debtor under IBC.\" width=\"861\" height=\"460\" \/><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_1_Appointment_of_Liquidator_Section_34\"><\/span><span style=\"color: #000080;\"><strong><u>Step 1 : Appointment of Liquidator ( Section 34 )<\/u><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Resolution Professional appointed for the CIRP shall subject to submission of written consent to the NCLT, act as a liquidator for the purposes of liquidation unless replaced by the NCLT under Sec 34(4).<\/li>\n<li>The NCLT shall by order replace the Resolution Professional, if\n<ul>\n<li>Resolution Plan submitted by RP under Section 30 was rejected for failure to meet the mandatory requirements of resolution Plan As per Section 30(2)<\/li>\n<li>IBBI recommends the replacement of a Resolution Professional to the NCLT for reasons to be recorded in writing and also propose a name of Insolvency Professional.<\/li>\n<li>The RP fails to submit the written consent<\/li>\n<\/ul>\n<\/li>\n<li>For the purposes of Sec 34(4)(a) &amp; (c) the NCLT may direct IBBI to propose the name of another Insolvency Professional to be appointed as a liquidator and IBBI shall propose the name within 10 days along with the written consent of the Insolvency Professional.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Step_II_A_%E2%80%93_Public_Announcement_of_Liquidation\"><\/span><span style=\"color: #000080;\"><strong>Step II \u00a0A &#8211; <\/strong><strong><u>Public Announcement of Liquidation<\/u><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>As soon as the Adjudicating authority passes the liquidation order, liquidator is required to public announcement within 5 days of Liquidation order in Form B of Schedule II<\/li>\n<li><span style=\"color: #000080;\"><strong>The public announcement shall-<\/strong><\/span>\n<ul>\n<li>Call upon stakeholders to submit their claims or update their claims submitted during the corporate insolvency resolution process, as on the liquidation commencement date; and<\/li>\n<li>Provide the last date for submission or updation of claims, which shall be thirty days from the liquidation commencement date.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>The announcement shall be published-<\/strong><\/span><\/p>\n<ul>\n<li>In one English and one regional language newspaper with wide circulation at the location of the registered office and principal office, if any, of the corporate debtor and any other location where in the opinion of the liquidator, the corporate debtor conducts material business operations;\n<ul>\n<li>on the website, if any, of the corporate debtor; and<\/li>\n<li>on-the website, if any, designated by the Board for this purpose<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Step_II_B-_Claims_Process_in_Liquidation\"><\/span><span style=\"color: #000080;\"><strong>Step II \u00a0B- <\/strong><strong><u>Claims Process in Liquidation <\/u><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>The liquidator shall receive or collect the claims of creditors within a period of thirty days from the date of the commencement of the liquidation<\/li>\n<li>A financial creditor may submit a claim to the liquidator by providing a record of such claim with an information utility: Provided that where the\u00a0 information relating to the claim is not recorded in the information utility, the financial creditor may submit the claim in the same manner provided for\u00a0 the submission of claims for the operational creditor.<\/li>\n<li>An operational creditor may submit a claim to the liquidator with such supporting documents required to prove the claim as may be specified by\u00a0 the Board.<\/li>\n<li>A creditor who is partly a financial creditor and partly an operational creditor\u00a0 shall submit claims to the liquidator to the extent of his financial\u00a0 debt in the manner as provided in sub-section (2) and to the extent of his\u00a0 operational debt under sub-section (3).<\/li>\n<li>Creditor may withdraw or vary his claim under this section within fourteen days of its submission.<\/li>\n<li>The liquidator shall verify the claims submitted under section 38 within such time as specified by the Board (within thirty days from the last date for receipt of claims)<\/li>\n<li>Liquidator may require any creditor or the corporate debtor or any other person to produce any other document or evidence which he thinks\u00a0 necessary for the purpose of verifying the whole or any part of the claim<\/li>\n<li>After verification of claims the liquidator may, either admit or reject the claim, in whole or in part, as the case may be however he shall record in\u00a0 writing the reasons for such rejection.<\/li>\n<li>The liquidator shall communicate his decision of admission or rejection of claims to the creditor and corporate debtor within <em>seven days <\/em>of such\u00a0 admission or rejection of claims.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Step_IV_Reports_to_be_prepared_by_Liquidator\"><\/span><span style=\"color: #000080;\"><strong>Step IV : <\/strong><strong><u>Reports to be prepared by Liquidator<\/u><\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li><span style=\"color: #000080;\"><strong>Asset Memorandum<\/strong>&#8211;<\/span> To evaluate the assets and property of the corporate debtor in the manner as may be specified by the Board and prepare a report.\u00a0 \u00a0<em>(Within 75 Days) (SEC 35(1)(c) , Reg 5(1), Reg 34)<\/em><\/li>\n<\/ul>\n<ul>\n<li><span style=\"color: #000080;\"><strong>Progress Report<\/strong>&#8211;<\/span> To report the progress of the liquidation process in a manner as may be specified by the board.\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0<em><u>(15 days from the end of each quarter) (SEC 35(1)(n))<\/u><\/em><\/li>\n<\/ul>\n<ul>\n<li><span style=\"color: #000080;\"><strong>Preliminary Report- <\/strong>Rep<\/span>ort prepared in accordance with Regulation 13 <em>(75 days) (Reg 2(1)(f) &amp;13)<\/em><\/li>\n<\/ul>\n<ul>\n<li><span style=\"color: #000080;\"><strong>First Progress report- <\/strong><\/span>The quarterly report prepared in accordance with Regulation 15 <strong>\u00a0 \u00a0 \u00a0 \u00a0\u00a0<em>(<\/em><\/strong><em>15 days from the end of quarter of appointment (Reg 2(1)(g) &amp;15)<\/em><\/li>\n<\/ul>\n<ul>\n<li><strong><span style=\"color: #000080;\">Subsequent Progress Report-<\/span> <\/strong>In case IP ceases to act as a liquidator, then 15 days from the date of cessation. <strong>\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 (<\/strong><em>15 days from the end of every quarter (Reg 2(1)(g) &amp;15) )<\/em><\/li>\n<\/ul>\n<ul>\n<li><strong><span style=\"color: #000080;\">Sale Reports-<\/span> <\/strong><em><u>To be enclosed with Progress report after sale of each asset (Reg 5(1), Reg 36)<\/u><\/em><\/li>\n<li><span style=\"color: #000080;\"><strong>Minutes of consultation with the stakeholders<\/strong><\/span><em><span style=\"color: #000080;\">\u00a0<\/span> \u00a0 \u00a0 (<\/em><em>After every meeting (Reg 5(1), Reg <\/em><em>8)<\/em><\/li>\n<\/ul>\n<ul>\n<li><span style=\"color: #000080;\"><strong>The Final Report prior to distribution, <\/strong><\/span><strong>\u00a0 \u00a0 (<\/strong><em><u>Within 1 Year (Reg 5(1), Reg 45) )<\/u><\/em><\/li>\n<\/ul>\n<ul>\n<li>Provide Copies of the reports and minutes to stakeholders in electronic or physical forms: on application from stakeholder; receipt of cost of making reports or minutes; receipt of confidentiality undertaking. (Reg 5(3))<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Step_V_%E2%80%93_Sale_of_Assets\"><\/span><span style=\"color: #000080;\"><strong>Step V &#8211; Sale of Assets<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-23017\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/08\/Realiasation-under-Insolvency-Law..jpg\" alt=\"Realiasation under Insolvency Law.\" width=\"768\" height=\"398\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/08\/Realiasation-under-Insolvency-Law..jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/08\/Realiasation-under-Insolvency-Law.-300x155.jpg 300w\" sizes=\"(max-width: 768px) 100vw, 768px\" \/><\/p>\n<ul>\n<li>If a company goes into liquidation, all of its assets are distributed to its creditors based on a\u00a0pre-determined priority order. Secured creditors are first in line, as their claims over assets are often secured by collateral and a contract.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Step_VI_%E2%80%93_Distribution_of_Assets_as_per_Waterfall\"><\/span><span style=\"color: #000080;\"><strong>Step VI <\/strong><strong>&#8211; <\/strong><strong>Distribution of Assets as per Waterfall<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Amount available under a Resolution Plan or proceeds of sale of assets\u00a0 of the liquidation estate\u00a0 will be distributed in the\u00a0 manner and in the priority\u00a0 based on the value of\u00a0 security Interest of each\u00a0 creditor:<\/p>\n<ol>\n<li>CIRP Cost and liquidation Cost (including any interim finance),<\/li>\n<li>Secured debt together with workmen dues for the preceding 24 months rank highest in priority based on value of security interest of each creditor.<\/li>\n<li>Employee dues for a period of12 months<\/li>\n<li>Other unsecured financial creditors.<\/li>\n<li>Central and state Government dues (2years)and remaining part\u00a0 of secured debt, if any after\u00a0 sale of mortgaged assets by\u00a0 financial creditors<\/li>\n<li>Any remaining debts and dues, dues of suppliers of goods or services, remaining dues of workmen, employees and Govt. authorities<\/li>\n<li>Preferential shareholders<\/li>\n<li>Equity shareholders or partners (in the case of LLP)<\/li>\n<\/ol>\n<h3><span class=\"ez-toc-section\" id=\"Step_VII_%E2%80%93_Dissolution_of_Corporate_Debtor_to_be_completed_within_1_year\"><\/span><span style=\"color: #000080;\"><strong>Step VII <\/strong><strong>&#8211; <\/strong><strong>Dissolution of Corporate Debtor (to be completed within 1 year)<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>According to IBC provision : The\u00a0<em>liquidation<\/em>\u00a0process of any\u00a0<em>corporate debtor under<\/em>\u00a0IBC Code will have to be\u00a0<em>completed within 1 year<\/em>\u00a0of its commencement <em>liquidation process within 1 year of its commencement, notwithstanding pendency of applications for avoidance transactions,<\/em><\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong><u>Distribution of Proceeds \u2013 Regulation 42.<\/u><\/strong><\/span><\/p>\n<ul>\n<li>The liquidator shall distribute the proceeds from realization within 90 Days (earlier six months) from the receipt of the\u00a0 amount to the stakeholders.<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong><u>Proceed of Liquidation and Distribution of Proceeds Regulation 41 and Regulation 42.<\/u><\/strong><\/span><\/p>\n<ul>\n<li>The Liquidator shall open a bank account in the name of the corporate debtor followed by the\u00a0 words \u2018in liquidation\u2019, in a scheduled bank, for the\u00a0 receipt of all moneys due to the corporate debtor.<\/li>\n<li>Liquidator shall deposit in the bank account opened under sub-regulation (1) all moneys,\u00a0 including cheques and demand drafts received by\u00a0 him as the liquidator of the corporate debtor, and\u00a0 the realizations of each day shall be deposited into\u00a0 the bank account without any deduction not later\u00a0 than the next working day.<\/li>\n<li>The liquidator may maintain a cash of one lakh rupees or such higher amount as may\u00a0 be\u00a0 permitted by the adjudicating authority to meet\u00a0 liquidation costs.<\/li>\n<li>All payments out of the account by the liquidator above five thousand rupees shall be made by\u00a0 cheques drawn or online banking transactions\u00a0 against the bank account.<\/li>\n<li>Subject to the provisions of section 53, the liquidator shall not commence distribution before the list of stakeholders and the asset memorandum has been filed with the Adjudicating Authority.<\/li>\n<li>The liquidator shall distribute the proceeds from realization within 90 Days (earlier six months) from the receipt of the amount to the stakeholders.<\/li>\n<li>Insolvency resolution process costs, if any, and the liquidation costs shall be\u00a0 deducted before such distribution is made.<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong><u>Distribution of Proceeds \u2013 Section 53<\/u><\/strong><\/span><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-22423\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/06\/531-of-IBC-act.jpg\" alt=\"53(1) of IBC act- IBC : Realisation &amp; Distribution of Assets by Liquidator\" width=\"748\" height=\"444\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/06\/531-of-IBC-act.jpg 748w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/06\/531-of-IBC-act-300x178.jpg 300w\" sizes=\"(max-width: 748px) 100vw, 748px\" \/><\/p>\n<ul>\n<li>Notwithstanding anything to the contrary contained in any law enacted by the Parliament or any State Legislature for the time being in force, the proceeds from the sale of the liquidation assets shall be distributed in the following order of priority and within such period as may be specified, namely: &#8211;\n<ol>\n<li>the insolvency resolution process costs and the liquidation costs paid in full;<\/li>\n<li>Following debts which shall rank equally between and among the following:<\/li>\n<\/ol>\n<\/li>\n<\/ul>\n<p style=\"padding-left: 40px;\"><strong>(i)<\/strong> workmen\u2019s dues for the period of twenty-four months preceding the liquidation commencement date; and<\/p>\n<p style=\"padding-left: 40px;\"><strong>(ii)<\/strong> debts owed to a secured creditor in the event such secured creditor has relinquished\u00a0 security in the manner set out in section 52;<\/p>\n<ol>\n<li style=\"list-style-type: none;\">\n<ol>\n<li>wages and any unpaid dues owed to employees other than workmen for the period of twelve months preceding the liquidation commencement date;<\/li>\n<li>financial debts owed to unsecured creditors;<\/li>\n<li>the following dues shall rank equally between and among the following : &#8211;<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n<ol>\n<li style=\"list-style-type: none;\">\n<ol>\n<li style=\"list-style-type: none;\">\n<ol>\n<li>any amount due to the Central Government and the State Government including the amount to be received on account of the\u00a0 Consolidated Fund of India and the Consolidated Fund of a State, if\u00a0 any, in respect of the whole or any part of the period of two years\u00a0 preceding the liquidation commencement date;<\/li>\n<li>debts owed to a secured creditor for any amount unpaid following the enforcement of security interest;\n<ul>\n<li>any remaining debts and dues;<\/li>\n<li>preference shareholders, if any; and<\/li>\n<li>equity shareholders or partners, as the case may be.<\/li>\n<\/ul>\n<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n<p style=\"padding-left: 40px;\">Any contractual arrangements between recipients under sub-section (1) with equal ranking, if disrupting the order of priority under that sub-section shall be disregarded by the liquidator.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_VIII_%E2%80%93_Dissolution_Of_CD_under_IBC\"><\/span><span style=\"color: #000080;\"><strong>Step VIII <\/strong><strong>&#8211; <\/strong><strong>Dissolution Of CD under IBC <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>When all of the corporate debtor&#8217;s assets have been liquidated, the liquidator must apply to the AA for the corporate debtor&#8217;s dissolution under Section 54 of the Code.<\/li>\n<li>If the liquidator believes there are not enough realisable assets to cover the cost of the liquidation and further inquiry into the affairs of the corporate debtor is not necessary, they may apply for an early dissolution under Regulation 14 of the Liquidation Regulations at any time after the preliminary report is prepared.<\/li>\n<li>Orders for dissolution must be filed with the appropriate authority where the corporate debtor is registered as soon as they are passed.<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>Conclusion<\/strong><\/span><\/p>\n<ul>\n<li>Do you need the top bankruptcy lawyers in India? The best place for you to log on is Rajput Jain &amp; Associates, where we offer top-notch services and can connect you with the country&#8217;s top bankruptcy lawyers.<\/li>\n<li>These days, bankruptcy attorneys are increasingly sought after in our nation, and our services are highly respected because we offer the best assistance and bankruptcy lawyers in India.<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>Popular blog:-<\/strong><\/span><\/p>\n<ul>\n<li><span style=\"color: #000080;\"><strong><a style=\"color: #000080;\" href=\"https:\/\/carajput.com\/blog\/sale-as-going-concern-under-liquidation\/\">Sale as Going concern under liquidation\u00a0<\/a><\/strong><\/span><\/li>\n<li><span style=\"color: #000080;\"><strong><a style=\"color: #000080;\" href=\"https:\/\/carajput.com\/blog\/liquidator-fees-to-be-paid-cirp-regulations\/\">Liquidator fees to be paid CIRP Regulations<\/a><\/strong><\/span><\/li>\n<li><a href=\"https:\/\/www.caindelhiindia.com\/blog\/initiation-of-liquidation-under-the-ibc\/\"><strong>Initiation of Liquidation under the IBC Code\u00a0<\/strong><\/a><\/li>\n<li><span style=\"color: #000080;\"><strong><a style=\"color: #000080;\" href=\"https:\/\/carajput.com\/blog\/liquidation-process-for-cd-under-ibc\/\">Liquidation Process for CD under IBC\u00a0<\/a><\/strong><\/span><\/li>\n<li><span style=\"color: #000080;\"><a style=\"color: #000080;\" href=\"https:\/\/carajput.com\/blog\/ibc-forms-insolvency-and-bankruptcy-code-2016-forms-demand-notices-returns\/\"><strong>IBC Forms Insolvency and Bankruptcy Code 2016 Forms Demand Notices Returns<\/strong><\/a><\/span><\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Services_in_the_field_of_Insolvency_Laws\"><\/span><span style=\"color: #000080;\"><i><span lang=\"EN-US\"><b>Services in the field of Insolvency Laws<\/b><\/span><\/i><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li><i><span lang=\"EN-US\">Services as \u2018Insolvency Professionals\u2019<\/span><\/i><\/li>\n<li><i><span lang=\"EN-US\">Team of Experts to act as an \u2018Insolvency Professional\u2019.<\/span><\/i><\/li>\n<li><i>Equipped with the required infrastructure to take control of Corporate Debtor and to make a meaningful concern in the long run.<\/i><\/li>\n<li><i>Cash flow monitoring and coordinating with banks<\/i><\/li>\n<li><i>Drafting &amp; vetting of Expression of Interest, Information Memorandum and Evaluation Matrix<\/i><\/li>\n<li><i>Expert team for filing and Verification of claims<\/i><\/li>\n<li><i>Drafting and Filing reports with the Adjudicating Authority (NCLT)<\/i><\/li>\n<li><i>Filing of replies and applications with the Adjudicating Authority as and when the situation demands.<\/i><\/li>\n<li><i>Equipped with necessary Infrastructure to Liquidate the Corporate Debtors-<\/i><\/li>\n<li><i>Assist in Valuation &amp; Forensic audit\/Transaction audit, Assist in Sale of the corporate debtor as going concerned<\/i><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Liquidation Process for Corporate Debtor under IBC As per Insolvency and Bankruptcy Code read with Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (with amendments) Form E of Schedule II, provided by the corporate debtor, must be submitted in person, by mail, or electronically to the liquidator as proof of claim. In accordance &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10081],"tags":[5446],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/23014"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=23014"}],"version-history":[{"count":4,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/23014\/revisions"}],"predecessor-version":[{"id":23244,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/23014\/revisions\/23244"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=23014"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=23014"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=23014"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}