At a glance
| Governing law | Insolvency and Bankruptcy Code, 2016 and Companies Act, 2013 |
|---|---|
| Minimum default | ₹1 crore for initiating corporate insolvency (Section 4, IBC) |
| Who can file | Financial creditors (Section 7), operational creditors (Section 9) and the company itself (Section 10) |
| Operational creditor notice | Section 8 demand notice; the debtor has 10 days to pay or point to a pre-existing dispute |
| CIRP timeline | 180 days, extendable by 90 days, with an outer limit of 330 days including litigation |
| Appeals | To the NCLAT within 30 days, extendable by 15 days for sufficient cause |
NCLT matters we handle
Section 7 petitions
Insolvency petitions by banks, NBFCs, lenders and other financial creditors.
Section 8 notice and Section 9 petitions
Demand notices and petitions by suppliers, service providers and other operational creditors.
Defending corporate debtors
Opposing admission, raising pre-existing disputes and settlement under Section 12A.
CIRP and liquidation
Claims before the resolution professional, Committee of Creditors issues, resolution plans and avoidance applications.
Oppression and mismanagement
Petitions under Sections 241 and 242 of the Companies Act by shareholders and directors.
Mergers and restructuring
Schemes of arrangement, amalgamation and demerger under Sections 230 to 232.
How an IBC petition proceeds
Assess the debt
Confirm the amount, date of default, limitation and supporting records. The default must be at least ₹1 crore.
Demand notice (operational creditors)
Serve the Section 8 notice with invoices. Wait 10 days for payment or a notice of dispute.
File the petition
File in the prescribed form before the NCLT bench having jurisdiction over the company's registered office.
Admission
The NCLT checks that a debt and default exist (and, for operational creditors, that there is no pre-existing dispute).
Moratorium and IRP
On admission, a moratorium starts and an interim resolution professional takes over management.
Resolution or liquidation
The Committee of Creditors considers resolution plans. If none is approved, liquidation follows.
Insolvency is not a recovery suit
Courts have repeatedly held that the IBC is meant for resolution, not debt collection. For operational creditors, a genuine dispute that existed before the demand notice will defeat the petition. Choosing between an IBC petition, a commercial suit, arbitration or a DRT application is a strategic decision that turns on the debtor's position and your evidence.
Frequently asked questions
What is the minimum amount to file a case in the NCLT under the IBC?
The default must be at least ₹1 crore, a threshold in force since 24 March 2020. NCLT benches have held that for an operational creditor's Section 9 petition, each creditor must individually meet the threshold.
What is a pre-existing dispute?
It is a real dispute about the debt or the quality of goods or services that existed before the Section 8 demand notice was received, for example in emails, earlier notices or pending litigation. If shown, the NCLT will reject an operational creditor's petition.
Can a company settle after an insolvency petition is admitted?
Yes. Under Section 12A, the petition can be withdrawn with the approval of 90 percent of the voting share of the Committee of Creditors, and before the committee is formed, with the NCLT's leave.
What happens to directors when CIRP starts?
The board is suspended and its powers vest in the interim resolution professional. Directors must cooperate and may face avoidance or fraudulent trading proceedings in some cases.
Can minority shareholders approach the NCLT?
Yes. Members holding the prescribed minimum shareholding, or with the NCLT's waiver, can file oppression and mismanagement petitions under Sections 241 and 242 of the Companies Act.
Talk to Inovatree about nclt cases
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Last reviewed 24 October 2026. This guide summarises the law in general terms. Every matter turns on its own facts, so take advice before acting.