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Bankruptcy Consultants In India

Recovery Of Financial And Operational Debt In India Through Insolvency

Drafting of Insolvency Petition
Filing of your matter with NCLT
Appearances by the Advocates and pleadings for the same
Final Order from NCLT
Recovery of Financial and Operational debt from the Debtors

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    India has been seeing a remarkable growth rate in the last few years and this is in itself a parameter to prove that all sectors are doing good business. Still not all firms, companies or entities, are doing as well as the economy. There are a few which are not able to meet their expenses, others who are unable to pay their debts, yet others who simply were never able to take off and looking for exit options.

    As a result, there are many Indians seeking help for winding up, bankruptcy, insolvency or liquidation of companies. Specific rights are endowed on the creditors which they can opt to exercise against the insolvent company or even debtors who want to liquidate their solvent company.

    While the Constitution of India grants the liberty to practice any profession or to carry on any occupation, trade or business to its citizens, yet at the same time, it places restrictions on closure of any commercial entity. The intent behind these regulations are primarily to protect the public interest, prevent unemployment and avert fraud or economic wrongdoing.

    The insolvency laws have had a topsy-turvy ride in India, with multiple overlapping laws and adjudicating forums making it a tedious, time-taking process. But the enforcement of Insolvency and Bankruptcy Code, 2016, (IBC) has streamlined the process to give positive result in a time bound fashion.

    Are you seeking bankruptcy consultants in India to overcome any adverse situation at the earliest? Confused over whom to approach? Don’t know how to authenticate such firms? Worried about time, money and the result?

    Don’t lose heart and put in all your trust in MUDS Consulting Firm- one-stop solution for all your woes!

    We are a name to reckon with, in the legal field, as dedicated towards delivering most viable solutions, advice and guidance. Our team of bankruptcy consultants in India extends unwavering support to companies, businesses and individuals to deal with cumbersome rules and regulations of Insolvency and Bankruptcy Code, 2016.

    Recovery Of Debt Services That We Offer In India:

    Initiation of Corporate Insolvency Resolution Process by Financial Creditor: Section 7 of IBC
    Application for initiation of corporate insolvency resolution process by Operational Creditor: Section 9 of IBC.
    Summary Suit (Order 37 of the Code of Civil Procedure Code, 1908)
    Section 138 of the Negotiable Instruments Act, 1881 (Cheque Bounce cases)

    A company is an entity born out of a legal process and understandably, its death or end also has to be through legal recourse. Opting for insolvency and liquidation simply indicates that the company has outlived its purpose, which can be due to one of the many factors, and is therefore, being dissolved, either voluntarily or forcefully.

    We at MUDS possess an excellent team of bankruptcy consultants in India which is accomplished in dealing with the intricacies of IBC. It is the deep insight and strategic approach of these qualified professionals which has helped the firm successfully close 160+ such cases. We have a pan India presence and therefore, geographical placement of the clients is not an issue of concern for us.

    Eligibility Criteria To File Recovery Of Debt Cases:

    1. In case of initiation of Corporate Insolvency Resolution Process by Financial Creditor, it should owe the financial debt and the debt should be legally assigned to him and transferred. The Term “Financial Creditor” includes Banks, Financial Institutions, Homebuyers, Enterprise, Corporate Entity or Company (Section 7 of the IBC).

    According to Sub-section (1) of the Act, the Financial Creditor either by itself or jointly with other financial creditors may file an application for initiating the Corporate Insolvency Resolution Process against a corporate debtor when a default has occurred.

    The Adjudicating Authority shall within 14 days of the receipt of the application under sub-section (2), ascertain the existence of the default from the records of the information utility or on the basis of the evidence furnished by the financial creditor under sub-section (3).

    Also, where the Adjudicating authority is satisfied that:

    A default has occurred and the application under sub-section (2) is complete, & there are no disciplinary proceedings pending against the proposed resolution professional, it may, by order, admit such application; or
    Default has not occurred or the application under sub-section (2) is incomplete or any disciplinary proceeding is pending against the proposed resolution professional, it may by order, reject such application.

    2.  In case of initiation of Corporate Insolvency Resolution Process by the Operational Creditor, the Operational Creditor should owe the financial debt and the debt should be legally assigned to him and transferred. The term “Operational Creditor” includes Manufacturers, Traders, Employees (Section 9 of the IBC).

    After the expiry of the period of 10 days from the date of delivery of the notice or the invoice demanding payment under (1) of section 8, if the operational creditor does not receive payment from the corporate debtor or the dispute under sub-section (2) of section 8, the operational creditor may file an application before the adjudicating authority for initiating the CIRP process.

    The Adjudicating authority shall within 14 days of the receipt of the application under sub-section (2), by an order:

    I) Admit the application and communicate such decision to the operational creditor and corporate debtor if,

    The application made under sub-section (2) is complete.
    There is no repayment of the unpaid operational debt.
    The invoice or notice for payment to the corporate debtor has been delivered by the operational creditor.
    No notice of dispute has been received by the operational creditor or there is no record of dispute in the information utility; and
    There are no disciplinary proceedings pending against any resolution professional proposed under sub-section (4).

    I) Admit the application and communicate such decision to the operational creditor and corporate debtor if,

    The application made under sub-section (2) is incomplete.
    There has been repayment of the unpaid operational debt.
    The Creditor has not delivered the invoice or notice for payment to the corporate debtor.
    Notice of dispute has been received by the operational creditor or there is a record in the information utility.
    Any disciplinary proceeding is pending against any proposed resolution professional.

    3.   In case of the Summary Suit under Order 37 of the Code of Civil Procedure, 1908, the Creditor shall file the Summary Suit in the respective courts having jurisdiction if there is a suit upon Bills of Exchange, Hundis and Promissory Notes.

    Suits in which the plaintiff seeks only to recover a debt or liquidated demand in money payable by the defendant, with or without interest, arising:

    On a Written Contract,
    On an Enactment, where the sum sought to be recovered is a fixed sum of money or in the nature of the debt other than a penalty; or
    On a guarantee, where the claim against the principal is in respect of a debt or liquidated demand only.

    4.  Section 138 of the Negotiable Instruments Act, 1881 (Cheque Bounce Recovery Case): If the customer delays the payment through cheque then the seller can file a suit against the customer under Section 138 of the Negotiable Instruments Act, 1881.

    Under Section 138, a legal notice is sent to the customer regarding the bouncing of the cheque and if he does not pay within 30 days, then the seller can file a suit against the customer under Section 138 of the NI Act regarding non-payment of the payment.

    A process like insolvency or liquidation involves a great deal of legal word to be done, from initiation to conclusion it is an arduous task which only an efficient body of professionals can perform! Take an informed decision today, to make your tomorrow tension free.

    Our team of bankruptcy consultants in India is capable of taking full charge of such issues and solve it, that too, in a cost-effective way. An incompetent and inexperienced firm, which does not engage top-notch professionals, will not be able to relieve you of your problems.

    Document Required

    Documents Required For Recovery Of Financial And Operational Debt Through Insolvency

    Demand Notice (form 3 and form 4 – IBBI Rules)
    Company’s Ledger Account
    Copy of the Invoices showing proof of transactions between the two parties
    Bank Statements of the Operational/ Financial Creditor
    Affidavit by the Operational creditor Section 9 (3) (b) –IBBI Rules
    Acknowledgement of Transaction between 2 parties
    Copy of the Emails exchanged between 2 parties
    Copy of the Legal Notice served by the Operational/ Financial Creditor
    Affidavit – Bank Certificate – (Section 9 of IBBI Rules) (not mandatory)

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      A Comparative Chart Of All Options

      Comparison Basis Section 7 of IBC Section 9 of IBC Summary Suit (Order 37 of Cpc, 1908) Section 138 of NI Act, 1881
      Claim Amount Minimum Amount is Rs. 1 lac Minimum Amount is Rs. 1 lac It is prescribed as per the Code of Civil Procedure, 1908. It is prescribed as per the NI Act, 1881.
      Limitation Period It is 3 years from the date when the debt has become due. It is 3 years from the date when the debt has become due. The limitation is prescribed as per the 45 days is the time period for filing the case in the Concerned Court when the cheque has been bounced.
      Total time-frame 6 months (Approx.) 6 months (Approx.) 3-4 months (Approx.) 6 months- 1 year (It can vary)
      Type of Persons availing the Services Homebuyers, Financial Institutions, Banks etc. (They all are termed as Financial Creditors) Employees, Traders, Manfacturers (They all are termed as Financial Creditors) Manfacturers, Traders, Buisnessmen and any other person dealing in goods and services. Any person whose cheque has been bounced by the Bank due to insufficient funds on payment by the debtor.
      Court Fees to be Paid Rs. 25,000 Rs. 2,000 It is prescribed as per the Amount of claim. It is prescribed as per the Amount of claim.

       

      Alternately Call our Legal Expert Now For Free Consultation at 09599653306

      Frequently Asked Questions on Bankruptcy Consultants in India

      According to Section 3 (11) of IBC, ‘debt’ refers to any amount or obligation which is due from anyone; it includes financial as well as operational debt.

      In case of initiation of the insolvency process, there are certain eligibility criteria laid down by the Insolvency and Bankruptcy Code, 2016.

      • If a default has occurred.
      • The Creditor should owe the debt.
      • The debt should be legally assigned to the debtor and transferred.

      The Adjudicating authority is NCLT but those cases where the party is dissatisfied by the action of NCLT, they can approach NCLAT.

      The Financial Creditor or the Operational Creditor, initiating action under Section 7 and Section 9 of the Insolvency and Bankruptcy Code, 2016, need to act within three years from when the debt had become due or payable.

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