On March 10, 2026, the Union Cabinet cleared the most significant amendment to the Insolvency and Bankruptcy Code since the 2018 reforms. The IBC Amendment Bill — which had been tabled by the Ministry of Corporate Affairs in August 2025 and referred to a Parliamentary Select Committee — has now been approved with most of the committee's recommendations incorporated.

For CS, CA, and CMA students, this is not optional reading. These changes will appear in upcoming examinations and are already reshaping insolvency practice across India.

1. Creditor-Initiated Insolvency Resolution Process

The most significant structural addition is the introduction of a Creditor-Initiated Insolvency Resolution Process — a new alternative to the standard CIRP under Section 7 and Section 9. This process is designed to be faster and less adversarial, allowing creditors and debtors to initiate a structured resolution before resorting to full CIRP proceedings.

The key distinction: under standard CIRP, management control transfers to the IRP immediately. Under the creditor-initiated process, there is provision for the debtor's management to remain involved in the initial phase — making it structurally closer to the PPIRP model but available beyond the MSME category.

2. Two-Tier Approval Framework for Resolution Plans

The Amendment introduces a two-tier approval framework for resolution plans, requiring both CoC approval (existing 66% threshold) and an additional layer of scrutiny for plans that significantly impact operational creditors or government dues. This addresses longstanding criticism that CoC's commercial wisdom was too often shielding plans that were unfair to non-financial creditors.

3. Cross-Border Insolvency Provisions

For the first time, cross-border insolvency provisions are being formally introduced into IBC. India had acknowledged the UNCITRAL Model Law as the appropriate framework but had not enacted Part IV. The Amendment changes this by incorporating key principles of the Model Law — primarily around recognition of foreign insolvency proceedings and coordination between Indian courts and foreign tribunals.

The Jet Airways case demonstrated the gap clearly — Dutch and Indian proceedings had to be coordinated ad hoc. The Amendment creates a legal framework so future cross-border insolvencies are handled systematically rather than case by case.

4. Group Insolvency Framework

The Amendment introduces a Group Insolvency Framework — a mechanism for dealing with the insolvency of interconnected companies within the same corporate group. Previously, each entity had to go through separate CIRP proceedings even when their debts were interlinked. The new framework allows for consolidated or coordinated proceedings for group companies, significantly reducing duplication and improving recovery.

5. Guarantor Asset Transfer Provision

A new clause allows assets of personal or corporate guarantors to be transferred to lenders as part of an insolvency resolution plan. This closes a gap that allowed promoters to shield personal assets from resolution while their companies went through CIRP. Combined with the existing Section 29A promoter bar and the IBBI's new electronic monitoring of personal guarantors, this creates a comprehensive enforcement framework.

6. Secured Creditor Clarification on State/Central Authority Claims

The Amendment clarifies that government authority claims — from tax departments, regulatory bodies, and state entities — will be treated as secured creditors only if there is a contractual agreement between the parties establishing such security. Without a contract, government dues cannot claim priority over other unsecured creditors simply by virtue of being government bodies.

The IBC Amendment Bill will need to be formally tabled and passed in Parliament. Watch for the final text — some provisions may be modified during Parliamentary debate. But for examination purposes, the Cabinet-approved version is what students should prepare from.

In a landmark judgment delivered on February 13, 2026, the Supreme Court of India held that telecom spectrum cannot be treated as a corporate asset in insolvency proceedings under the Insolvency and Bankruptcy Code, 2016. A bench of Justices P.S. Narasimha and Atul S. Chandurkar ruled that "IBC cannot be the guiding principle for restructuring the ownership and control of spectrum."

Background: The Aircel Group Insolvency

The dispute arose from the insolvency proceedings of the Aircel Group — Aircel Limited, Aircel Cellular Limited, and Dishnet Wireless Limited — which entered voluntary CIRP under Section 10 of the IBC in 2018 after defaulting on licence fees and spectrum usage charges payable to the Department of Telecommunications (DoT).

The Aircel Group had acquired spectrum in the 900 MHz, 1800 MHz, and 2100 MHz bands through government auctions between 2010 and 2016, paying over ₹6,249 crore. A consortium of lenders led by SBI had extended term loans of ₹13,729 crore. During the CIRP, the resolution professionals treated spectrum as part of the corporate debtor's asset pool. The DoT challenged this — arguing spectrum is a sovereign natural resource, not a company asset.

The Core Legal Question

The question before the Supreme Court was whether telecom service providers (TSPs), called upon to pay licence fees by the DoT, can invoke the IBC moratorium to defer those payments by treating spectrum as a restructurable corporate asset.

What the Supreme Court Held

The Supreme Court held that spectrum is a scarce natural resource held by the Union of India in public trust under Article 39(b) of the Constitution and Section 4 of the Indian Telegraph Act, 1885. Telecom companies acquire only a conditional, revocable privilege to use spectrum — not an ownership right.

IBC, the Court held, applies only to assets over which the corporate debtor has ownership rights. Since TSPs do not own spectrum — they merely hold a licence — spectrum cannot be included in the asset pool for insolvency resolution or liquidation. The moratorium under Section 14 of the IBC cannot be used to defer DoT's recovery of licence fees and spectrum charges.

Practical Implications

• For lenders: Spectrum cannot be relied upon as an asset recoverable in insolvency. Banks that lent to telecom companies cannot count spectrum in the resolution pool.
• For resolution professionals: Spectrum rights must be excluded from the information memorandum's asset schedule.
• For the telecom sector: Government dues for spectrum cannot be treated like ordinary creditor claims — they survive the insolvency resolution process.

Distinction from Earlier NCLAT Position

The NCLAT had earlier held that while spectrum is owned by the nation, the right to use it constitutes an intangible asset of the licensee. The Supreme Court disagreed — drawing a sharp line between an asset and a conditional privilege. The NCLAT's reasoning was reversed.

The Insolvency and Bankruptcy Board of India (IBBI) issued Circular No. IBBI/II/92/2026 on March 6, 2026, introducing a set of electronic forms to monitor insolvency resolution processes involving personal guarantors to corporate debtors under the IBC. This is a significant operational development that takes Part III of IBC from theoretical to actively enforced.

Why This Was Needed

Until now, resolution professionals handling personal guarantor insolvency proceedings were required to submit periodic updates to the IBBI through email. The Board described this method as "time-consuming and inefficient" — with errors, omissions, and delays being common. The new electronic forms replace this entirely with a structured, digitised system hosted on the IBBI website.

What the New Forms Cover

The IBBI has introduced a set of four forms — PGIRP 1 through PGIRP 4 — each tied to a specific stage of the personal guarantor insolvency resolution process:

• PGIRP 1: Initial filing on commencement of insolvency proceedings against a personal guarantor
• PGIRP 2: Submission of repayment plan details and updates
• PGIRP 3: Periodic progress updates during the process
• PGIRP 4: Final submission on conclusion — whether through approval, rejection, discharge, or withdrawal

Each form is submitted via the IBBI portal using a unique username and password assigned to the resolution professional, authenticated through digital signature or e-signing. The IBBI has also built in a modification utility allowing corrections through an OTP-based process.

Why This Matters Beyond Compliance

This circular is more than a procedural update. It signals that Part III of IBC is being actively enforced — not just used in theory. Since the Supreme Court's 2021 ruling in Lalit Kumar Jain v. Union of India confirmed that personal guarantors can be subjected to insolvency proceedings independently of the corporate debtor's CIRP, the number of personal guarantor proceedings has grown. This circular is the regulatory infrastructure catching up.

For promoters who provided personal guarantees for corporate loans, this is a direct signal: the days of CIRP protecting corporate debtors while personal guarantors remained untouched are ending. IBBI now has a structured, real-time window into every personal guarantor proceeding.

Connection to Broader IBC Enforcement Trend

This circular sits alongside two other recent developments that together paint a clear picture of where IBC enforcement is heading: the IBBI's amendment to the Bankruptcy Process Regulations for Personal Guarantors (February 25, 2026) which tightened valuation standards, and the IBC Amendment Bill's new provision allowing guarantor assets to be transferred to lenders as part of a resolution plan.

Most CS, CA, and CMA students know IBC reasonably well. They can name the sections, describe the CIRP process, and recall the key case laws. But they consistently lose marks in the exam — not because they lack knowledge, but because they don't structure their answers correctly.

The difference between a 6-mark answer and a 10-mark answer on the same IBC question is almost never knowledge. It's structure. And the structure has a name: ILAC.

What Is the ILAC Framework?

ILAC stands for Issue → Law → Application → Conclusion. It is the standard legal reasoning framework used in professional examinations worldwide, and it is exactly what examiners in CS/CA/CMA look for in IBC answers.

Add a fifth step specifically for IBC — Case Law — and you have the complete five-part structure that consistently earns full marks.

Step 1: Issue

Identify the precise legal question that the problem is asking. Do not start with a definition. Start with: "The issue in this case is whether [party] can [action] under the Insolvency and Bankruptcy Code, 2016."

This single sentence tells the examiner you have read the question, understood what is being asked, and are applying the law — not regurgitating a textbook.

Step 2: Law

State the relevant provision clearly. Quote the section number. Give the key requirement. "Under Section 7 of the IBC, 2016, a financial creditor may file an application before the NCLT upon the occurrence of a default by the corporate debtor. The minimum default threshold is ₹1 crore."

No vague references. Specific section. Specific requirement.

Step 3: Application

Apply the law to the specific facts in the question. This is where most students go wrong — they repeat the law instead of applying it. "In the present case, X Bank is a financial creditor as defined under Section 5(7) of the IBC, having extended a term loan to ABC Ltd. ABC Ltd. has defaulted on repayment of ₹3 crore, which exceeds the ₹1 crore threshold. Therefore, the conditions of Section 7 are satisfied."

Step 4: Conclusion

State the outcome cleanly. "Therefore, X Bank is entitled to file an application under Section 7 before the NCLT to initiate CIRP against ABC Ltd."

Step 5: Case Law

Add one relevant case law to confirm the principle. "This position was affirmed by the Supreme Court in Innoventive Industries Ltd. v. ICICI Bank (2018), which held that upon proof of financial debt and default, NCLT must admit a Section 7 application."

A Live Example: Section 29A Application Question

Question: P was the promoter of ABC Ltd. which is currently undergoing CIRP. P wishes to submit a resolution plan for ABC Ltd. Advise P.

Issue: The issue is whether P, as the erstwhile promoter of ABC Ltd., is eligible to submit a resolution plan during the ongoing CIRP.

Law: Section 29A of the IBC, 2016 bars certain persons from submitting resolution plans. A person who was a promoter or in the management or control of the corporate debtor, or who is in any way connected to a non-performing asset, is ineligible. This section was inserted by the IBC Amendment Act, 2018.

Application: Since P was the promoter of ABC Ltd., P falls squarely within the disqualification criteria under Section 29A(c). Unless P can demonstrate that the account was not classified as NPA — or that P falls within one of the limited exceptions under Section 240A (applicable to MSMEs only) — P is ineligible to submit a resolution plan.

Conclusion: P cannot submit a resolution plan for ABC Ltd. under the IBC. P should be advised not to submit such a plan as it will be rejected by the Committee of Creditors and the NCLT.

Case Law: The Supreme Court in ArcelorMittal India Pvt. Ltd. v. Satish Kumar Gupta (2019) upheld Section 29A as constitutionally valid, holding that barring defaulting promoters from submitting resolution plans is a legitimate policy choice.

If there is one IBC case every CS, CA, and CMA student must know cold, it is Committee of Creditors of Essar Steel India Ltd. v. Satish Kumar Gupta (2019). This Supreme Court judgment answered three of the most contested questions in IBC jurisprudence — and its answers changed how every CIRP in India is run.

Background: The Essar Steel CIRP

Essar Steel India Ltd. was one of India's largest steel manufacturers — and one of the first major IBC cases after the Code's introduction in 2016. The company had total debt of approximately ₹49,000 crore. The CIRP attracted several resolution applicants; the Committee of Creditors ultimately approved ArcelorMittal's resolution plan. But before the plan could be implemented, it was challenged on multiple grounds — leading to a protracted legal battle that reached the Supreme Court.

The Three Central Questions

Question 1: Can Courts Overrule CoC's Commercial Decisions?

The most important issue was whether NCLT and NCLAT have the power to substitute their commercial judgment for that of the CoC. The operational creditors and certain financial creditors argued that the CoC's distribution formula was unfair and should be revised by the court.

The Supreme Court held that the CoC's commercial decisions are largely non-justiciable. Courts cannot substitute their view for the CoC's on how to distribute proceeds, which resolution plan to approve, or how to deal with competing claims — unless the decision is arbitrary, in bad faith, or violates the basic framework of the IBC.

Question 2: Are Operational Creditors Entitled to Equal Treatment?

Operational creditors argued they were being treated unfairly compared to financial creditors in the distribution of resolution proceeds. They argued this differential treatment was arbitrary and violated Article 14 of the Constitution.

The Supreme Court rejected this argument. It held that differential treatment of financial and operational creditors is valid — provided it is not arbitrary. Financial creditors monitor the debtor's financial health more closely, have exposure in the form of loans, and bear a different kind of risk. This justifies giving them a seat in the CoC and a different priority in distribution. The Court was careful to say this does not mean operational creditors get nothing — a minimum must be allocated.

Question 3: Is the 330-Day Timeline a Hard Deadline?

The 330-day timeline for completing CIRP had become routinely breached across India's tribunals. The Supreme Court used Essar Steel to send a clear message: the 330-day deadline is real. Courts should not extend it casually. Extensions should be rare exceptions backed by compelling reasons — not the norm.

Why This Case Is Exam-Critical

Essar Steel is the constitutional and philosophical backbone of IBC as it operates today. The principles it established — CoC commercial wisdom, differential treatment of creditor classes, and the 330-day hard deadline — appear in almost every scenario-based IBC question in CS/CA/CMA examinations.

When a question asks about the CoC rejecting a settlement offer, or about operational creditors claiming equal rights, or about the court being asked to review a CoC decision — the answer runs through Essar Steel.

When the Insolvency and Bankruptcy Code was originally passed in 2016, it contained a significant loophole: there was no bar on who could submit a resolution plan. In theory — and in practice — a promoter who had run a company into the ground could submit a resolution plan, shed the debt through CIRP, and take back control of the company at a steep discount. This happened.

Section 29A was inserted by the IBC Amendment Act, 2018, specifically to close this loophole. It is now one of the most-tested provisions in IBC examinations and one of the most litigated in insolvency practice.

What Section 29A Says

Section 29A sets out categories of persons who are ineligible to submit a resolution plan. The key categories include:

• A person who is an undischarged insolvent
• A wilful defaulter under RBI guidelines
• A person whose account has been classified as NPA for one year or more
• A promoter or person in management or control of the corporate debtor, or a related party — if they are connected to an NPA
• A person who has been convicted of any offence punishable with imprisonment of two years or more
• A person disqualified as a director under the Companies Act
• A guarantor of a debt owed by the corporate debtor

The Three Exceptions Most Students Miss

Exception 1: Section 240A — MSME Promoters

Section 240A of the IBC, inserted by the 2019 Amendment, provides that the disqualifications under Section 29A(c) and 29A(h) do not apply to the promoter of an MSME. This recognises that MSMEs are often closely held and that barring the promoter outright may kill the business entirely. If the corporate debtor qualifies as an MSME, its promoter can submit a resolution plan — subject to CoC approval and other conditions.

Exception 2: Financial Entities — Section 29A(i)

Scheduled banks, asset reconstruction companies, and other financial entities regulated by RBI or SEBI are excluded from several of the disqualifications in Section 29A — specifically where the NPA classification relates to their lending activities rather than their own borrowing. This is important for ARCs that may wish to submit resolution plans.

Exception 3: Connected Person with Prior Approval

In cases where a connected person holds an NPA in an unrelated capacity — not as a promoter of that specific corporate debtor — there is scope for arguing that the bar should not apply. Courts have dealt with this on a case-by-case basis and the law is still evolving. Students should note that Section 29A's application depends heavily on the specific facts.

How Courts Have Applied Section 29A

The constitutional validity of Section 29A was upheld by the Supreme Court in Swiss Ribbons Pvt. Ltd. v. Union of India (2019) and ArcelorMittal India Pvt. Ltd. v. Satish Kumar Gupta (2019). Both cases confirmed that barring defaulting promoters from the resolution process is a legitimate and proportionate policy choice, not arbitrary or unconstitutional.