IBC · IBC · Chapter 9

Chapter 9 - Fast Track CIRP

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Insolvency and Bankruptcy Code 2016 — Insolvency and Bankruptcy Code 2016.

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Q

What is the essential purpose of the Fast Track Corporate Insolvency Resolution Process (CIRP) under the IBC, 2016?

A

It is a faster, shorter-timeline insolvency resolution process designed specifically for specified smaller categories of corporate debtors, unlike the standard CIRP which applies to all corporate debtors.

Q

What voting share threshold does a CoC need to approve a resolution plan in Fast Track CIRP?

A

75% voting share of the Committee of Creditors

Q

Which categories of corporate debtors are eligible to undergo Fast Track CIRP under the IBC, 2016?

A

Fast Track CIRP applies to small companies, startups (other than partnership firms), and unlisted companies with total assets below a threshold prescribed by the Central Government.

Q

Did the IBC Amendment Act 2018 reduce the voting threshold for Fast Track CIRP from 75% to 66%?

A

No, the 2018 reduction was not extended to Fast Track CIRP

Q

How does the timeline for Fast Track CIRP differ from the standard CIRP under the IBC, 2016?

A

Fast Track CIRP must be completed within 90 days from the insolvency commencement date, compared to 180 days for standard CIRP, reflecting its accelerated nature for smaller debtors.

Q

What is the maximum total period for Fast Track CIRP including a single extension?

A

135 days (90 days plus 45-day extension)

Q

Under what provision of the IBC, 2016 is the Fast Track CIRP governed?

A

Fast Track CIRP is governed by Chapter IV (Sections 55 to 58) of the IBC, 2016, which carves out a separate and distinct process for eligible smaller corporate debtors.

Q

What is the permissible extension period that a CoC may seek for Fast Track CIRP?

A

Not more than 45 days with 75% CoC vote

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