Answer By law4u team
The Insolvency and Bankruptcy Code (IBC) provides for a time-bound process for completing bankruptcy/insolvency proceedings. The timeline for completing the proceedings under the IBC is as follows: Corporate Insolvency Resolution Process (CIRP) The CIRP is a process initiated for corporate debtors (companies) who are unable to repay their debts. The timeline for completing the CIRP is 180 days, which can be extended by another 90 days if required. Therefore, the maximum time allowed for completing the CIRP is 270 days. Fast Track Corporate Insolvency Resolution Process (FCCIRP) The FCCIRP is a simplified version of the CIRP, which is available for small companies with a lower amount of debt. The timeline for completing the FCCIRP is 90 days, which can be extended by another 45 days if required. Therefore, the maximum time allowed for completing the FCCIRP is 135 days. Liquidation Process If the CIRP or the FCCIRP fails to produce a workable resolution plan, the company is liquidated. The timeline for completing the liquidation process is one year, which can be extended by another year if required. Therefore, the maximum time allowed for completing the liquidation process is two years. It is important to note that the timelines mentioned above are subject to certain conditions and exceptions, and may vary depending on the specific circumstances of the case. For example, the timeline for completing the CIRP may be extended if the National Company Law Tribunal (NCLT) is satisfied that the delay was due to exceptional circumstances. Similarly, the timeline for completing the liquidation process may be extended if the NCLT is satisfied that the delay was due to exceptional circumstances and that the interests of the stakeholders would be better served by such an extension.
