Section 11 of IBC : Section 11: Persons Not Entitled To Make Application
IBC
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Explanation using Example
Imagine a company, XYZ Pvt. Ltd., which has been facing financial difficulties. Six months ago, XYZ Pvt. Ltd. underwent a corporate insolvency resolution process (CIRP), and a resolution plan was approved by its creditors. Now, XYZ Pvt. Ltd. is facing financial troubles again and wishes to initiate a new CIRP to resolve its debts. However, according to Section 11 of The Insolvency and Bankruptcy Code, 2016, XYZ Pvt. Ltd. cannot initiate a new CIRP because it is still within the twelve-month period following the approval of the previous resolution plan. Therefore, XYZ Pvt. Ltd. must wait another six months before it is eligible to apply for another CIRP.