Insolvency and bankruptcy lawyers in Chennai
IBC petitions, Committee of Creditors work, resolution plans, liquidation and guarantor proceedings.
Overview
We act for financial and operational creditors, corporate debtors, resolution professionals and resolution applicants in proceedings under the Insolvency and Bankruptcy Code, 2016, before the National Company Law Tribunal and the National Company Law Appellate Tribunal.
Insolvency under the Code starts with a default of one crore rupees or more. A creditor, or the company itself, applies to the tribunal. Once the application is admitted, a resolution professional runs the process, a moratorium stops recovery action, and the Committee of Creditors decides between a resolution plan and liquidation.
In Chennai these cases are heard by the National Company Law Tribunal, Chennai Bench. Appeals lie to the Chennai Bench of the National Company Law Appellate Tribunal, and further appeals go to the Supreme Court.
Our Insolvency & Bankruptcy services
Creditors
Starting insolvency
A financial creditor can apply under Section 7 to start the corporate insolvency resolution process once a default has occurred. Allottees under a real estate project must apply jointly, in a group of at least one hundred allottees or ten per cent of the allottees of the project, whichever is less. An operational creditor first serves a demand notice under Section 8, and can apply under Section 9 if the company neither pays nor discloses a dispute within ten days.
Committee of Creditors
Representing creditors in the Committee of Creditors, which is made up of all financial creditors under Section 21 and votes on resolution plans and on the major steps of the process. Tribunals do not sit in appeal over the commercial wisdom of the committee (Vallal RCK v. Siva Industries, (2022) 9 SCC 803).
Challenging resolution plans
Objections and appeals against approved resolution plans and against the resolution professional's decisions on claims, including appeals to the National Company Law Appellate Tribunal under Section 61.
Corporate debtors
Debtor advice
Advising companies on starting insolvency themselves under Section 10, on negotiating with creditors, and on preparing for the process. A default that arose between 25 March 2020 and 24 March 2021 cannot ground an application, because Section 10A bars filings for that period.
Pre-packaged insolvency for MSMEs
The pre-packaged insolvency resolution process under Chapter III-A is open to companies classified as micro, small or medium enterprises under the MSMED Act, 2006, subject to the conditions in Section 54A. The process has to be completed within 120 days under Section 54D.
Resolution professionals and applicants
Support for resolution professionals
Legal advice to resolution professionals on running the corporate insolvency resolution process, verifying claims and complying with the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016.
Resolution applicants
Due diligence on the company, checks on eligibility under Section 29A, which bars persons such as undischarged insolvents, wilful defaulters and persons whose accounts have been non-performing assets for at least a year, and drafting resolution plans that meet the requirements of Section 30. An approved plan binds the company, its creditors and its guarantors under Section 31.
Avoidance transactions
Applications to set aside preferential transactions under Section 43, undervalued transactions under Section 45, extortionate credit transactions under Section 50 and fraudulent or wrongful trading under Section 66, including claims that directors contribute to the assets of the company.
Liquidation, guarantors and cross-border cases
Liquidation
Advice to stakeholders when a company goes into liquidation, which the tribunal orders under Section 33 when no resolution plan is approved or a plan is rejected. Section 53 sets the order in which the proceeds are paid, starting with the costs of the process and the liquidation.
Personal guarantors
Insolvency proceedings by creditors against personal guarantors of corporate debtors, and defence of such proceedings. Approval of a resolution plan does not free a guarantor from liability (Lalit Kumar Jain v. Union of India, (2021) 9 SCC 321).
Cross-border insolvency
Cases involving creditors or assets abroad. Section 234 lets the Central Government enter into agreements with other countries and apply the Code to assets outside India where reciprocal arrangements exist.
Laws we work with
- Insolvency and Bankruptcy Code, 2016
- IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2016
- IBBI (Liquidation Process) Regulations, 2016
- Micro, Small and Medium Enterprises Development Act, 2006
- Limitation Act, 1963
- Companies Act, 2013
Courts and tribunals
- National Company Law Tribunal, Chennai Bench
- National Company Law Appellate Tribunal, Chennai Bench
- Supreme Court of India
Questions and answers
Frequently asked questions
8 questions. These answers are general information about Indian law, not legal advice on your situation.
What is the minimum default needed to start insolvency against a company?
One crore rupees. Section 4 of the Insolvency and Bankruptcy Code, 2016 applies the Code to the insolvency and liquidation of corporate debtors where the default is at least that amount.
Can an operational creditor start insolvency proceedings?
Yes. The creditor first serves a demand notice or invoice under Section 8. If the company does not pay within ten days or give notice of a dispute, the creditor can file an application under Section 9.
How long does the corporate insolvency resolution process take?
Section 12 allows 180 days from admission of the application, with one extension of up to 90 days if the Committee of Creditors passes a resolution with 66 per cent of the voting shares. Including time taken in legal proceedings, the process has to be completed within 330 days. The Supreme Court has said that time beyond that is granted only in exceptional cases (Committee of Creditors of Essar Steel India Ltd. v. Satish Kumar Gupta, (2020) 8 SCC 531).
What is the time limit to file an insolvency application?
Three years from the date of default, under Article 137 of the Limitation Act, 1963. The Supreme Court held in B.K. Educational Services v. Parag Gupta, (2019) 11 SCC 633, that the right to apply accrues when the default occurs, so an application filed more than three years later is barred unless the delay is condoned under Section 5 of that Act.
What happens to court cases and recovery action against the company once insolvency starts?
Admission of the application starts a moratorium under Section 14. It stops the institution or continuation of suits and proceedings, including execution of court orders, and bars enforcement of security over the company's assets. The moratorium ends when the process ends, such as when the tribunal approves a resolution plan under Section 31.
Can insolvency be started for a default that arose during the COVID period?
No. Section 10A bars an application to start the process for defaults that arose between 25 March 2020 and 24 March 2021. In Power Trust v. Bhuvan Madan (2026 INSC 166), the Supreme Court held that the bar did not apply to a default of March 2018, because restructuring proposals that never took effect could not move the date of default into that period.
How long do I have to appeal an order of the NCLT under the Code?
An appeal to the National Company Law Appellate Tribunal has to be filed within 30 days of the order, under Section 61(2). Time runs from the date the order is pronounced, not from receipt of a copy, though time taken to supply a certified copy applied for within limitation is excluded (V. Nagarajan v. SKS Ispat and Power Ltd., (2022) 2 SCC 244). The Appellate Tribunal can excuse a delay of up to 15 further days on sufficient cause, so the outer limit is 45 days.
Does approving a resolution plan end claims against guarantors?
No. The Supreme Court held in Lalit Kumar Jain v. Union of India, (2021) 9 SCC 321, that approval of a resolution plan does not discharge the personal guarantor, whose liability is independent of the company's. Creditors can continue proceedings against a guarantor after the plan is approved.