Corporate Insolvency Resolution Process (CIRP) In India's Insolvency And Bankruptcy Code: A Comprehensive Analysis
- IJLLR Journal
- 1 hour ago
- 2 min read
Shubham Kumar Tiwary, The ICFAI University, Dehradun
ABSTRACT
The Corporate Insolvency Resolution Process (CIRP) represents a transformative reform in India’s approach to corporate distress resolution through the Insolvency and Bankruptcy Code, 2016. This comprehensive analysis examines CIRP’s conceptual framework, operational mechanics, and practical implications within India’s commercial law ecosystem. The research explores how CIRP revolutionized corporate restructuring by transitioning from a debtor-centric model to a creditor-controlled framework prioritizing time-bound resolution and value maximization.
The study traces India's insolvency framework evolution, highlighting the fragmented system preceding IBC implementation. Through examination of the Bankruptcy Law Reforms Committee’s recommendations and subsequent legislative developments, the analysis demonstrates how CIRP addresses pre-IBC regime deficiencies including prolonged resolution timelines, inadequate recovery rates, and conflicting jurisdictions. CIRP’s design principles of creditor control, strict timelines, and professional management represent fundamental departure from traditional judicial management approaches.
The research evaluates resolution plan structures, assessment criteria, and dichotomous resolution versus liquidation outcomes. Through analysis of eligibility restrictions, feasibility requirements, and stakeholder treatment provisions, the study demonstrates CIRP’s attempt to balance value maximization with fair stakeholder treatment. Recovery rates and resolution timeline examination provides empirical evidence of CIRP’s effectiveness compared to previous regimes while acknowledging ongoing implementation challenges.
Significant attention focuses on judicial oversight framework, examining National Company Law Tribunal, National Company Law Appellate Tribunal, and Supreme Court roles in shaping CIRP jurisprudence. Landmark judicial decisions analysis reveals court interpretations of key statutory provisions, commercial wisdom doctrine development, and competing stakeholder interest balancing within CIRP framework.
The study critically examines CIRP system challenges including capacity constraints in insolvency professional ecosystems, sectoral regulator coordination difficulties, and ongoing operational creditor treatment debates. Recent legislative amendments including eligibility restrictions, timeline modifications, and pre-packaged insolvency resolution process introduction are analyzed for framework effectiveness impact.
Keywords: Corporate Insolvency Resolution Process, Insolvency and Bankruptcy Code, Creditor Control, Resolution Professional, Committee of Creditors
