Insolvency and Bankruptcy code 2016
This query is : Resolved
P.Madhivadhanan
(Querist)
13 January 2026
X Ltd registered with RBI as NBFC, has defaulted in the payment of due to its catering contractor. Whether catering contractor can initiate IRP under IBC 2016 against the company as an operational creditor.Catering contractor is Partnership firm
14 January 2026
A catering contractor cannot initiate CIRP under IBC, 2016 against an NBFC, even as an operational creditor.
NBFCs are excluded from IBC corporate insolvency
Under Section 227 of IBC, only such financial service providers as notified by Central Government can be brought under IBC.
Currently:
✔ Banks, NBFCs, Insurance companies, etc. are governed by special resolution frameworks of RBI
✔ NBFCs are treated as Financial Service Providers (FSPs)
✔ Normal CIRP under Sections 7, 9, 10 does not apply to NBFCs
Only limited class of NBFCs notified under special FSP rules (like DHFL type cases) can be taken under IBC through government notification.
NBFCs are excluded from IBC corporate insolvency
Under Section 227 of IBC, only such financial service providers as notified by Central Government can be brought under IBC.
Currently:
✔ Banks, NBFCs, Insurance companies, etc. are governed by special resolution frameworks of RBI
✔ NBFCs are treated as Financial Service Providers (FSPs)
✔ Normal CIRP under Sections 7, 9, 10 does not apply to NBFCs
Only limited class of NBFCs notified under special FSP rules (like DHFL type cases) can be taken under IBC through government notification.
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