{"id":32786,"date":"2026-08-11T16:17:35","date_gmt":"2026-08-11T10:47:35","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=32786"},"modified":"2026-08-12T01:35:29","modified_gmt":"2026-08-11T20:05:29","slug":"ibbi-2026-liquidation-framework-faster-transparent","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/","title":{"rendered":"IBBI 2026 Liquidation Framework: Faster &#038; Transparent"},"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-6a96bcc58e6f6\" 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-6a96bcc58e6f6\"  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\/ibbi-2026-liquidation-framework-faster-transparent\/#Overview_on_Amendments_to_the_IBBI_Liquidation_Regulations_2026\" title=\"Overview on Amendments to the IBBI Liquidation Regulations (2026)\">Overview on Amendments to the IBBI Liquidation Regulations (2026)<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Major_Changes_in_Amendments_to_the_IBBI_Liquidation_Regulations_2026\" title=\"Major Changes in Amendments to the IBBI Liquidation Regulations (2026)\">Major Changes in Amendments to the IBBI Liquidation Regulations (2026)<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#CoC_Replaces_Stakeholder_Consultation_Committee\" title=\" CoC Replaces Stakeholder Consultation Committee\"> CoC Replaces Stakeholder Consultation Committee<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#New_Liquidation_Timeline\" title=\" New Liquidation Timeline\"> New Liquidation Timeline<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Simplified_Claims_Process\" title=\" Simplified Claims Process\"> Simplified Claims Process<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Revised_Liquidator_Fee_Structure\" title=\" Revised Liquidator Fee Structure\"> Revised Liquidator Fee Structure<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Greater_CoC_Control\" title=\" Greater CoC Control\"> Greater CoC Control<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Replacement_of_Liquidator\" title=\" Replacement of Liquidator\"> Replacement of Liquidator<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Transfer_of_Guarantor_Assets\" title=\" Transfer of Guarantor Assets\"> Transfer of Guarantor Assets<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Reporting_Simplification\" title=\" Reporting Simplification\"> Reporting Simplification<\/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\/ibbi-2026-liquidation-framework-faster-transparent\/#Asset_Sale_Restrictions\" title=\" Asset Sale Restrictions\"> Asset Sale Restrictions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/#Clarification_on_Not_Readily_Realisable_Assets_NRRA\" title=\" Clarification on Not Readily Realisable Assets (NRRA)\"> Clarification on Not Readily Realisable Assets (NRRA)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/#Dissolution_and_Ongoing_Proceedings\" title=\" Dissolution and Ongoing Proceedings\"> Dissolution and Ongoing Proceedings<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/#Security_Interest_Changes\" title=\" Security Interest Changes\"> Security Interest Changes<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/#Treatment_of_Unremitted_TDSTCS\" title=\"Treatment of Unremitted TDS\/TCS\">Treatment of Unremitted TDS\/TCS<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/#Practical_Takeaway_for_Insolvency_Professionals\" title=\"Practical Takeaway for Insolvency Professionals \u00a0\">Practical Takeaway for Insolvency Professionals \u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/carajput.com\/blog\/ibbi-2026-liquidation-framework-faster-transparent\/#Overall_Impact\" title=\"Overall Impact\">Overall Impact<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2><img loading=\"lazy\" decoding=\"async\" class=\"alignnone  wp-image-23532\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2022\/10\/Amends-in-IBC-Regulations-in-Liquidation-process.jpeg\" alt=\"Amends in IBC Regulations in Liquidation process\" width=\"999\" height=\"572\" \/><\/h2>\n<h2><span class=\"ez-toc-section\" id=\"Overview_on_Amendments_to_the_IBBI_Liquidation_Regulations_2026\"><\/span><span style=\"color: #000080;\">Overview on Amendments to the IBBI Liquidation Regulations (2026)<\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The document proposes major changes to India&#8217;s liquidation framework under the Insolvency and Bankruptcy Code (IBC) following the Insolvency and Bankruptcy Code (Amendment) Act, 2025. key amendments (such as\u00a0Section 34A and Section 35(2) of the Code) for granting supervisory powers to the CoC in the liquidation process. The overall objective is to make liquidation faster, more creditor-driven, and aligned with the new statutory timeline of 180 days. The following key objectives are <a href=\"https:\/\/ibbi.gov.in\/uploads\/whatsnew\/323133d2f45c22777dfba9a05a45fc6a.pdf\">amendments to the IBBI Liquidation Regulations (2026):<\/a><\/p>\n<ul>\n<li>Complete liquidation within 180 days.<\/li>\n<li>Give the Committee of Creditors (CoC) a central supervisory role during liquidation.<\/li>\n<li>Eliminate duplicate claim verification processes.<\/li>\n<li>Rationalize liquidator fees.<\/li>\n<li>Improve transparency and accountability.<\/li>\n<li>Enable replacement of liquidators.<\/li>\n<li>Facilitate transfer of guarantor assets.<\/li>\n<li>Ensure continuity of avoidance and recovery proceedings even after dissolution.<\/li>\n<\/ul>\n<h2><span class=\"ez-toc-section\" id=\"Major_Changes_in_Amendments_to_the_IBBI_Liquidation_Regulations_2026\"><\/span><a href=\"https:\/\/ibbi.gov.in\/uploads\/whatsnew\/323133d2f45c22777dfba9a05a45fc6a.pdf\"><span style=\"color: #000080;\"><strong>Major Changes in Amendments to the IBBI Liquidation Regulations (2026)<\/strong><\/span><\/a><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3><span class=\"ez-toc-section\" id=\"CoC_Replaces_Stakeholder_Consultation_Committee\"><\/span><span style=\"color: #000080;\"><strong> CoC Replaces Stakeholder Consultation Committee<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>The CoC formed during CIRP will continue during liquidation.<\/li>\n<li>The existing Stakeholder Consultation Committee (SCC) framework is removed.<\/li>\n<li>CoC will exercise oversight and approve key liquidation decisions.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"New_Liquidation_Timeline\"><\/span><span style=\"color: #000080;\"><strong> New Liquidation Timeline<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Liquidation must be completed within 180 days from commencement.<\/li>\n<li>The Adjudicating Authority may extend this period by up to 90 days.<\/li>\n<li>Model timelines are revised accordingly.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Simplified_Claims_Process\"><\/span><span style=\"color: #000080;\"><strong> Simplified Claims Process<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Claims already verified during CIRP will automatically continue into liquidation.<\/li>\n<li>Only new claims or updates to existing claims need to be submitted.<\/li>\n<li>Creditors must update claims if they receive recoveries after liquidation begins.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Revised_Liquidator_Fee_Structure\"><\/span><span style=\"color: #000080;\"><strong> Revised Liquidator Fee Structure<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>The existing realization and distribution-based fee model is replaced.<\/li>\n<li>Fees may be paid:\n<ul>\n<li>As a monthly fee during liquidation, or<\/li>\n<li>As a percentage of distributions to stakeholders.<\/li>\n<\/ul>\n<\/li>\n<li>Changes reflect reduced work due to elimination of fresh claim verification.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Greater_CoC_Control\"><\/span><span style=\"color: #000080;\"><strong> Greater CoC Control<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The liquidator must obtain CoC approval for:<\/p>\n<ul>\n<li>Appointment of professionals.<\/li>\n<li>Liquidator remuneration.<\/li>\n<li>Major litigation decisions.<\/li>\n<li>Valuations.<\/li>\n<li>Liquidation costs.<\/li>\n<li>Asset sale strategies and auction-related decisions.<\/li>\n<li>Assignment of difficult-to-sell assets.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Replacement_of_Liquidator\"><\/span><span style=\"color: #000080;\"><strong> Replacement of Liquidator<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>CoC may replace the liquidator with a 66% voting share.<\/li>\n<li>An application must be filed before the Adjudicating Authority.<\/li>\n<li>The existing liquidator continues until replacement is approved.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Transfer_of_Guarantor_Assets\"><\/span><span style=\"color: #000080;\"><strong> Transfer of Guarantor Assets<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>New Regulation 8A enables transfer of assets of a corporate guarantor undergoing liquidation to support the CIRP of the principal borrower.<\/li>\n<li>Such transfers require CoC approval.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Reporting_Simplification\"><\/span><span style=\"color: #000080;\"><strong> Reporting Simplification<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Multiple reports to the Adjudicating Authority are consolidated.<\/li>\n<li>Progress reports will include:\n<ul>\n<li>CoC meeting minutes,<\/li>\n<li>Asset memorandum,<\/li>\n<li>Sale reports,<\/li>\n<li>Status of legal proceedings and costs.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Asset_Sale_Restrictions\"><\/span><span style=\"color: #000080;\"><strong> Asset Sale Restrictions<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Assets cannot be sold to persons ineligible under Section 29A.<\/li>\n<li>Related parties, liquidator relatives, and appointed professionals face additional restrictions on purchases.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Clarification_on_Not_Readily_Realisable_Assets_NRRA\"><\/span><span style=\"color: #000080;\"><strong> Clarification on Not Readily Realisable Assets (NRRA)<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>NRRAs include contingent, disputed, or avoidance-related assets even if not yet crystallized.<\/li>\n<li>Such assets may be assigned or transferred.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Dissolution_and_Ongoing_Proceedings\"><\/span><span style=\"color: #000080;\"><strong> Dissolution and Ongoing Proceedings<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Avoidance transactions, fraudulent trading cases, and recovery suits can continue even after dissolution.<\/li>\n<li>CoC will decide how such proceedings are pursued and proceeds distributed.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Security_Interest_Changes\"><\/span><span style=\"color: #000080;\"><strong> Security Interest Changes<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Secured creditors must inform the liquidator within 14 days whether they relinquish security. Timelines for related payments are prescribed.<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Treatment_of_Unremitted_TDSTCS\"><\/span><span style=\"color: #000080;\"><strong>Treatment of Unremitted TDS\/TCS<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>A significant clarification is proposed: TDS\/TCS deducted or collected by the corporate debtor before liquidation but not yet remitted to the government will be treated as third-party trust assets. Such amounts will not form part of the liquidation estate. The proposal follows the NCLT Bengaluru ruling in <em>New Age Real Properties LLP v. Bhuvana Infra Projects Pvt. Ltd.<\/em> (04.09.2025).<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Practical_Takeaway_for_Insolvency_Professionals\"><\/span><span style=\"color: #000080;\"><strong>Practical Takeaway for Insolvency Professionals <\/strong><strong>\u00a0<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The amendments fundamentally transform liquidation from a liquidator-centric system to a creditor-driven (CoC-driven) system. The major themes are time-bound liquidation (180 days), continuation of CoC throughout liquidation, reduced duplication in claim verification, enhanced creditor oversight, provision for replacement of liquidator, protection against conflict-of-interest sales, clarity on TDS\/TCS treatment, and better realization and recovery mechanisms.<\/p>\n<p>From an insolvency professional &amp; insolvency advisory perspective, the most impactful changes are the 180-day liquidation mandate, CoC supervision, and exclusion of unremitted TDS\/TCS from the liquidation estate, as these will directly affect recoveries, stakeholder priorities, and liquidation strategy<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Overall_Impact\"><\/span><span style=\"color: #000080;\"><strong>Overall Impact<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The amendments fundamentally transform liquidation from a liquidator-led process into a CoC-supervised process, reduce duplication of work, shorten timelines, strengthen creditor control, improve transparency, and clarify treatment of key issues such as guarantor assets, avoidance proceedings, and unremitted tax deductions<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Overview on Amendments to the IBBI Liquidation Regulations (2026) The document proposes major changes to India&#8217;s liquidation framework under the Insolvency and Bankruptcy Code (IBC) following the Insolvency and Bankruptcy Code (Amendment) Act, 2025. key amendments (such as\u00a0Section 34A and Section 35(2) of the Code) for granting supervisory powers to the CoC in the liquidation &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":[10523],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/32786"}],"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=32786"}],"version-history":[{"count":3,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/32786\/revisions"}],"predecessor-version":[{"id":32789,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/32786\/revisions\/32789"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=32786"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=32786"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=32786"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}