Section 41: Determination of Valuation of Claims
Section 41 of the Insolvency and Bankruptcy Code, 2016 requires the liquidator to determine the value of claims admitted under Section 40 in the manner specified by the Insolvency and Bankruptcy Board of India. It links the statutory claims process with the detailed valuation mechanism prescribed under the liquidation regulations.
Section 41 - Statutory provision
The liquidator shall determine the value of claims admitted under section 40 in such manner as may be specified by the Board.
Meaning of Section 41
Section 41 applies after a claim has been admitted under Section 40. The liquidator is required to determine the value of the admitted claim according to the manner prescribed by the Board. The provision is therefore concerned with quantification of an admitted claim rather than the earlier stages of submission, verification or the decision whether to admit or reject it.
Who determines the value of an admitted claim?
The statutory responsibility rests with the liquidator. Under the Code, the liquidator administers the liquidation process and performs the functions assigned under Chapter III. Section 41 specifically places determination of the value of admitted claims on the liquidator, subject to the method specified by the Board.
Meaning of the Board
The "Board" means the Insolvency and Bankruptcy Board of India established under the Insolvency and Bankruptcy Code, 2016. IBBI makes regulations governing the liquidation process and publishes amendments, circulars and prescribed formats relevant to insolvency professionals and stakeholders.
Claims process before valuation
The valuation contemplated by Section 41 follows the statutory claims process. Section 38 deals with submission and consolidation of claims. Section 39 governs verification of those claims and permits the liquidator to require further documents or evidence. Section 40 then permits the liquidator to admit or reject a verified claim, wholly or partly. Section 41 applies to the claims that have been admitted.
Determination of claim value under the liquidation regulations
The detailed manner of valuing claims is governed by the IBBI (Liquidation Process) Regulations, 2016. Where the amount of a claim is not precise because of a contingency or another reason, the regulatory framework enables the liquidator to make the best estimate of the amount based on the information available. The applicable regulations should always be consulted for the current method and procedural requirements.
Claim valuation and asset valuation are different
Section 41 concerns determination of the value of an admitted creditor claim. It should not be confused with valuation of the assets of the corporate debtor for purposes connected with the liquidation process. Asset valuation is governed by other provisions of the Code and regulations and may involve registered valuers and applicable valuation standards.
Current valuation framework under IBC
IBBI issued valuation standards and guidelines during 2026 for valuations conducted under the Insolvency and Bankruptcy Code. These materials are relevant where a valuation under the Code requires a registered valuer or application of prescribed valuation standards. Their application depends on the particular valuation exercise and should not be treated as replacing the specific claims-valuation rule applicable under Section 41 and the Liquidation Process Regulations.
Official legal resources
For the latest regulatory position, refer to the IBBI Liquidation Process Regulations, the IBBI Circulars and the IBBI Acts page.