Section 54A of IBC : Section 54A: Corporate Debtors Eligible For Pre-Packaged Insolvency Resolution Process

IBC

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Explanation using Example

Let's consider a hypothetical scenario to demonstrate the application of Section 54A of The Insolvency and Bankruptcy Code, 2016:

Imagine a company named "QuickFix Pvt. Ltd." that is classified as a medium enterprise under the MSME Act. The company has been facing financial difficulties and has defaulted on a loan of ₹1 crore from its primary lender, "SpeedyLoans Financial Services".

QuickFix Pvt. Ltd. wants to initiate a pre-packaged insolvency resolution process to address its debts without going through lengthy court procedures. To be eligible, the company ensures that:

  • It is a micro, small, or medium enterprise as per the MSME Act.
  • It has not been through an insolvency process in the last three years.
  • It is not currently undergoing an inso...

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