Ashok Kakkar
Quick Summary
The Insolvency and Bankruptcy Code, 2016 has transformed the way corporate financial distress is addressed in India. Before the IBC, insolvency and recovery matters were often handled through fragmented legal mechanisms, resulting in delays, prolonged litigation, and erosion of asset value. The Cor
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FAQ :
CIRP stands for Corporate Insolvency Resolution Process. It's the standard insolvency resolution process under the IBC for a corporate debtor that has defaulted on its payments, aiming to resolve the business as a going concern rather than through liquidation.
CIRP can be initiated by financial creditors (like banks), operational creditors (like suppliers), or the corporate debtor itself.
CIIRP stands for Creditor-Initiated Insolvency Resolution Process. It was introduced through a 2026 amendment to the IBC to address challenges in traditional proceedings, aiming for early intervention, preservation of enterprise value, and reduction of procedural delays.
CIRP is the principal, established insolvency resolution mechanism, while CIIRP is a newer, additional framework designed for faster, more efficient creditor-driven resolution in suitable cases, focusing on early intervention.
No, CIIRP does not replace CIRP. CIRP remains the principal corporate insolvency resolution mechanism, and CIIRP serves as an additional route to supplement the existing framework.
The objective of both CIRP and CIIRP is the resolution of corporate distress and the preservation of asset value, rather than immediate liquidation, while balancing the interests of all stakeholders.
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