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When broke, apply for bankruptcy, but process could be excruciating

Though the Insolvency and Bankruptcy Code, 2016 came into effect on December 2, 2016, and has rules for individual bankruptcy too, they have not been notified yet

Topics
Individual bankruptcy | bankruptcy law | Insolvency and Bankruptcy Code

Bindisha Sarang 



Once you have decided to file for bankruptcy, you need to approach a lawyer to file a proposal in the court, along with the necessary documentation
Once you have decided to file for bankruptcy, you need to approach a lawyer to file a proposal in the court, along with the necessary documentation

Over the years, we have heard stories about celebrities like Michael Jackson, Mike Tyson, Donald Trump and Vijay Mallya going broke, and some even filed for bankruptcy. However, it is rare to hear about individual bankruptcy/insolvency cases in India because the laws are much tougher, and of course, social stigma. The good thing is that you can do so even if you owe someone as little as Rs 500, according to the existing law which is almost over a century old. No wonder, the process can be excruciating. Suresh Surana, founder, RSM India says: “Bankruptcy arises where a person is unable to pay his debts. However, a person is considered bankrupt only when he is adjudged as one by the judicial authorities.”

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First Published: Thu, July 23 2020. 06:00 IST

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