How to Prepare and Submit a Resolution Plan Under the IBC: Eligibility, Documents & Timeline

A resolution plan under IBC is the central document through which a company undergoing corporate insolvency is rescued, restructured or acquired, and the Insolvency and Bankruptcy Code, 2016 treats it as the decisive output of the corporate insolvency resolution process. As the insolvency framework continues to evolve through legislative amendments, Insolvency and Bankruptcy Board of India (IBBI) regulations and judicial interpretation, prospective resolution applicants face an increasingly demanding submission environment. This guide sets out, in practitioner terms, how to prepare and submit a compliant resolution plan under IBC, covering who may apply, the documents required, the procedural steps, realistic timelines, costs to budget for, and the litigation traps that most commonly derail an otherwise sound bid.

It is written for financial investors, strategic acquirers, promoters, financial creditors, insolvency professionals and in-house counsel deciding whether and how to bid.

Overview, What is a Resolution Plan Under IBC?

A resolution plan under IBC is a proposal submitted by a resolution applicant for the revival of a corporate debtor admitted into the corporate insolvency resolution process (CIRP). Section 30 of the Insolvency and Bankruptcy Code, 2016 governs the submission and contents of the plan, and Section 31 governs its approval by the Adjudicating Authority, the National Company Law Tribunal (NCLT). In substance, the plan sets out how the applicant will deal with the debtor’s debts, how creditors will be paid, how operations will continue, and how the acquirer will fund and implement the turnaround.

What the Resolution Plan Must Achieve

A compliant resolution plan under IBC must demonstrate that it provides for the insolvency resolution of the corporate debtor as a going concern wherever possible, maximises the value of the debtor’s assets, and balances the interests of all stakeholders. Practically, this means a clear payment waterfall addressing the claims of financial and operational creditors, provision for the costs of the insolvency resolution process, a credible business continuity strategy, and a realistic implementation timetable. The committee of creditors (CoC) assesses the plan against its own evaluation matrix, weighing both financial return and the feasibility and viability of the proposed turnaround.

Legal Effect Once Approved

Once the CoC approves a resolution plan and the NCLT grants its sanction under Section 31, the plan becomes binding on the corporate debtor, its employees, members, creditors, guarantors and other stakeholders, as well as on the Central and State Governments and local authorities to whom statutory dues are owed. The Supreme Court of India has repeatedly affirmed the binding and clean-slate character of an approved plan, holding that claims not included in a sanctioned plan stand extinguished. This binding effect is precisely why the drafting, evidencing and defensibility of a resolution plan under IBC matter so much: errors cannot easily be unwound after sanction, and omissions can be fatal to the acquirer’s commercial assumptions.

Eligibility, Who Can Be a Resolution Applicant?

Eligibility is the first gate every bidder must clear. Section 29A of the Code disqualifies several categories of persons from submitting a resolution plan, and the fit-and-proper assessment applies to the applicant and its connected persons. Prospective resolution applicants should treat eligibility not as a one-off checkbox but as a continuing obligation that must be evidenced throughout the process.

Types of Eligible Applicants

• Financial investors. Private equity funds, asset reconstruction companies, distressed-debt specialists and other financial sponsors bidding for returns rather than strategic integration.
• Strategic buyers. Operating companies in the same or adjacent sector seeking to acquire the debtor’s assets, licences, market position or capacity.
• Consortiums. Combinations of financial and strategic parties, frequently structured through a special purpose vehicle (SPV), that pool capital and expertise to fund larger or more complex resolutions.

Ineligibility Triggers

Section 29A ineligibility is the single most litigated eligibility issue. Typical triggers include:

• Wilful default. Persons classified as wilful defaulters in accordance with the guidelines of the Reserve Bank of India are barred, and the applicant should affirmatively declare and evidence that no such classification applies to it or its connected persons.
• Undischarged insolvency or disqualified directorship. Undischarged insolvents and persons disqualified from acting as directors are ineligible.
• Criminal convictions. Convictions for offences punishable with imprisonment for the periods specified in Section 29A can disqualify an applicant, subject to the statutory conditions and timelines.
• Non-performing accounts. Persons who, or whose connected persons, hold an account classified as a non-performing asset for the period prescribed in Section 29A, subject to the cure pathways the Code allows (including payment of overdue amounts with interest), face restrictions.
• Connected and related persons. Disqualification extends to connected persons as defined in the Code, which is why consortium structures must be mapped carefully to avoid imputed ineligibility.

How to Structure Consortiums and SPVs to Pass Eligibility Tests

Because ineligibility attaches not only to the applicant but to its connected persons, the architecture of a consortium determines whether it survives a Section 29A challenge. Map every shareholder, controlling person and management participant against the disqualification grid before committing capital. Where a tainted party is unavoidable commercially, consider ring-fencing or exiting that party before the plan is submitted, and document the sequence contemporaneously. Build an affidavit pack evidencing the eligibility of each consortium member and each person in control, so that any CoC query or NCLT objection can be answered from the record rather than reconstructed under litigation pressure.

Confirm the current legislative position. The IBC is subject to periodic amendment, and proposed reforms are frequently under consideration by the Government and Parliament. Applicants must verify the commencement and notification status of any specific amending provision through the official Gazette of India and the Ministry of Corporate Affairs before relying on it. Different provisions may be brought into force on different dates by notification, so the operative text for a live bid should always be confirmed against the eGazette entry and any accompanying MCA or IBBI circular.

Step-by-Step: How to Submit a Resolution Plan in India

The following numbered procedure sets out how to submit a resolution plan in India from first diligence to post-approval implementation. Each step identifies who is responsible and what internal approvals and documents are typically required. Treat the sequence as cumulative: later steps depend on records created in earlier ones.

1. Step 1, Pre-bid diligence and forming the bid team. Assemble a cross-functional team covering legal, financial, tax, valuation and labour. Request access to the virtual data room provided by the interim resolution professional (IRP) or resolution professional (RP), and scope title, litigation, regulatory, employment and tax exposures. The quality of diligence here directly determines the credibility of the valuation and the robustness of the plan’s conditionality.
2. Step 2, Expression of Interest (EOI) and eligibility documents. Respond to the RP’s invitation for expressions of interest within the stated window, submitting the prescribed EOI form together with eligibility declarations, identity and constitution documents, and the Section 29A affidavits. The RP will apply the eligibility criteria and publish a provisional, then final, list of prospective resolution applicants.
3. Step 3, Heads of terms, indicative valuation and financing proof. Submit an indicative bid or heads of terms reflecting your preliminary valuation, together with early evidence of funding capacity. Current practice places weight on demonstrable proof of finance, so include term sheets or comfort letters rather than mere assertions of capability.
4. Step 4, Final plan drafting. Draft the full resolution plan, setting out creditor treatment and the payment waterfall, the implementation timetable, the financing plan, the management and governance structure, and the statutory declarations. Obtain internal legal and finance sign-off before finalising.
5. Step 5, Execution formalities. Secure board or committee resolutions authorising the bid, execute the necessary power of attorney in favour of the signatory, and complete corporate approvals for the SPV or consortium vehicle. Keep certified copies in the submission bundle.
6. Step 6, Submission of the resolution plan. Submit the plan to the RP strictly in accordance with the invitation: observe the prescribed format, the required number of copies, any electronic filing mechanism, sealing requirements and the exact deadline. Obtain written acknowledgement of receipt. Late or improperly sealed submissions are routinely rejected.
7. Step 7, CoC evaluation, clarifications and selection. The CoC evaluates compliant plans against its evaluation matrix, raises clarifications, and may run a challenge or auction process to improve value. Respond to clarifications promptly and in writing, and avoid introducing material changes that were not permitted by the process document.
8. Step 8, Post-approval implementation and monitoring. After CoC approval and NCLT sanction under Section 31, implement the plan in accordance with its timetable, fund the committed amounts through the agreed escrow or payment mechanism, and comply with any monitoring committee oversight.

Timeline Table: Step, Who and Typical Duration

Required Documents, Resolution Applicant Checklist and Sample Table of Contents

Incomplete or poorly evidenced resolution plan documents are among the most common reasons a bid fails at the eligibility or evaluation stage. The resolution applicant checklist below should be treated as the minimum baseline and tailored to the specific invitation issued by the RP and the regulations in force under the IBBI framework at the time of bidding.

Mandatory Statutory Attachments and Disclosures

Every resolution plan under IBC must carry the statutory declarations and disclosures prescribed by the Code and IBBI regulations, including the Section 29A eligibility affidavit and any disclosures the CoC’s process document requires. These attachments are not administrative formalities; they form the evidentiary foundation that defends the plan against later challenge.

Required-Documents Table

A well-organised plan opens with a table of contents mirroring these categories, followed by the executive summary, applicant eligibility section, business and turnaround plan, creditor treatment and waterfall, financing and funding evidence, implementation timetable, and the annexed declarations and instruments. A clean, cross-referenced structure makes CoC evaluation faster and reduces the risk of a clarification cycle.

Timeline & Deadlines, Statutory and Practical Milestones

The IBC resolution plan timeline runs within the overall statutory outer limit for completing the CIRP, inside which the EOI, bid and evaluation milestones are compressed by the CoC’s process document. Section 12 of the Code prescribes the outer time limit for completion of the CIRP, which includes an overall cap inclusive of extensions and litigation. In practice, the published timeline is a floor, not a ceiling: CoC clarifications, challenge mechanisms and NCLT hearings routinely extend matters, particularly where eligibility or valuation is contested.

Build buffers into your internal plan. Allow time for the CoC’s clarification rounds, for arranging and documenting committed finance, and for responding to any objections at the NCLT approval stage. Because statutory day counts for CoC approval and for filing the approved plan with the NCLT can be revised by amendment or IBBI regulation, confirm the exact figures against the current text of the Code, the CIRP Regulations and the official Gazette notification before relying on them.

Costs and Fees, What Bidders Should Budget For

Bidding for a distressed asset carries front-loaded costs that are incurred whether or not the bid succeeds. The following table identifies the principal cost categories; statutory fees such as NCLT filing charges and stamp duty vary by application type and by State and must be verified against the current schedule before filing.

Drafting and Design, Practical Implications for the Resolution Plan Under IBC

Legislative amendments, IBBI regulations and judicial pronouncements continue to shape the standards expected of a resolution plan under IBC. Applicants should read the Code alongside the IBBI’s implementing regulations and any clarificatory circulars, and should track the Gazette for the commencement dates of individual provisions.

Eligibility and Promoter Re-entry Rules

The disqualification regime in Section 29A significantly restricts the pathways by which promoters associated with the defaulting corporate debtor can re-enter through a resolution plan, subject to the carve-outs the Code provides (for example, for micro, small and medium enterprises in certain circumstances). Applicants with any connection to the existing promoter group must map their position against the statutory tests with particular care, and should expect such connections to be probed by the CoC and by objecting stakeholders at the NCLT.

Voting and Treatment Changes, Consequences for Plan Design

The thresholds and treatment rules affecting dissenting and minority creditors directly influence how a plan must be designed to secure approval. A resolution plan requires approval by the CoC by the statutory voting share prescribed in the Code, and the distribution to dissenting financial creditors must satisfy the minimum entitlements the Code and the Supreme Court’s jurisprudence require. Plan architects should model creditor outcomes precisely, ensuring the proposed distribution withstands scrutiny, and the payment waterfall and the comparison with liquidation value must be documented with rigour.

Practical Drafting Implications

The plan must be transparent about valuation methodology, assumptions and the source and certainty of financing. The CoC and the NCLT place weight on demonstrable proof of funds and committed escrow arrangements at the time of submission, rather than deferring financing certainty to a post-approval condition. Drafters should front-load financing evidence and reduce open-ended conditionality.

Common Pitfalls and How to Avoid Them

Most failed bids fail for avoidable reasons. The errors below recur across matters and each has a straightforward mitigation.

• Late or improperly sealed submission. Treat the invitation’s format, copy-count, sealing and deadline requirements as absolute. Build in a submission rehearsal and secure written acknowledgement of receipt.
• Incomplete eligibility disclosures. Missing or thin Section 29A affidavits invite challenge. Prepare a complete affidavit pack covering the applicant and every connected person before submission.
• Inadequate proof of funds. Assertions of financial capacity without term sheets, commitment letters or escrow arrangements are routinely discounted. Evidence funding at submission, not after approval.
• Vague creditor treatment. An imprecise payment waterfall or unclear transfer schedules undermine the plan’s feasibility assessment. State amounts, sequencing and timing explicitly.
• Unaddressed tax and contingent liabilities. Leaving tax exposures or contingent claims to chance erodes the clean-slate benefit. Build a contingent tax plan and reflect it in the financing.
• Weak litigation defensibility. Where ineligibility or valuation is challenged, the applicant needs contemporaneous evidence. Maintain an affidavit and documentary pack ready to answer objections at the NCLT or on appeal to the NCLAT.

Key Requirements at a Glance

Practical Checklist & Resources

To support preparation of your bid, work from a structured resolution applicant checklist, a sample table of contents for a resolution plan under IBC, a set of sample statutory declarations, and escrow and term-sheet templates. Each should be treated as a starting framework to be tailored to the specific invitation and reviewed by counsel before use. If you need tailored advisory support, you can contact a Global Law Experts insolvency specialist through the GLE expert profile.

Next Steps and Contact

Preparing a defensible resolution plan under IBC is a multidisciplinary exercise that rewards early engagement of legal, financial, tax and valuation advisors and disciplined record-keeping from the first day of diligence. Confirm the current status of the IBC provisions relevant to your bid, map eligibility across every connected person, evidence your financing at submission, and build the affidavit pack you will need to defend the plan before the NCLT. For end-to-end support in structuring, drafting, submitting and defending a resolution plan under IBC, connect with a Global Law Experts insolvency and restructuring specialist.

Sources

1. Insolvency and Bankruptcy Code, 2016, India Code (National Legislation Portal)
2. Ministry of Corporate Affairs, notifications & Gazette
3. Gazette of India / eGazette
4. Insolvency and Bankruptcy Board of India (IBBI), rules & regulations
5. National Company Law Tribunal (NCLT)
6. National Company Law Appellate Tribunal (NCLAT)
7. Supreme Court of India, judgments database
8. Bar Council of India