Section 91: Revocation of Order Admitting Application under the Insolvency and Bankruptcy Code, 2016

Section 91 is part of the fresh start process under Part III, Chapter II of the Insolvency and Bankruptcy Code, 2016. It enables the resolution professional to seek revocation of an order admitting a fresh start application when specified statutory grounds arise.

Key effect: If the Adjudicating Authority admits the revocation application, the moratorium and the fresh start process cease to have effect. The Adjudicating Authority is required to decide the revocation application within 14 days of its receipt.

Section 91 - Statutory Provisions

(1) The resolution professional may submit an application to the Adjudicating Authority seeking revocation of its order made under Section 84 on the following grounds, namely :-

(a) if due to any change in the financial circumstances of the debtor, the debtor is ineligible for a fresh start process; or

(b) non-compliance by the debtor of the restrictions imposed under sub-section (3) of Section 85; or

(c) if the debtor has acted in a mala fide manner and has wilfully failed to comply with the provisions of this Chapter.

(2) The Adjudicating Authority shall, within fourteen days of the receipt of the application under sub-section (1), may by order admit or reject the application.

(3) On passing of the order admitting the application referred to in sub-section (1), the moratorium and the fresh start process shall cease to have effect.

(4) A copy of the order passed by the Adjudicating Authority under this section shall be provided to the Board for the purpose of recording an entry in the register referred to in Section 196.

Who Can Seek Revocation?

Under the text of Section 91, the resolution professional may submit the application seeking revocation of the order made under Section 84. The provision identifies the resolution professional as the applicant for this statutory remedy.

Grounds for Revocation

Decision within Fourteen Days

Section 91(2) provides a 14-day period from receipt of the application for the Adjudicating Authority to admit or reject the revocation application. This statutory timeline is directed at deciding whether the earlier admission order should continue to operate.

Effect of an Order Allowing Revocation

Once the Adjudicating Authority passes an order admitting the revocation application, Section 91(3) provides that both the moratorium and the fresh start process cease to have effect. This should be read with Section 85(4), which otherwise provides for cessation of the moratorium after 180 days from admission unless the admission order is revoked under Section 91(2).

Record with the Insolvency and Bankruptcy Board of India

Section 91(4) requires a copy of the Adjudicating Authority's order to be provided to the Insolvency and Bankruptcy Board of India for recording an entry in the register referred to in Section 196 of the Code.

Meaning of Important Terms

Resolution professional: For Part III, Section 79 defines the resolution professional as an insolvency professional appointed under that Part for conducting the fresh start process or insolvency resolution process.

Moratorium: In the fresh start process, Section 85 provides for a moratorium in respect of debts upon admission of the application and specifies its legal effects and restrictions.

Adjudicating Authority: The expression refers to the adjudicating forum designated under the applicable provisions of the Code for proceedings under Part III.

Board: The Board is the Insolvency and Bankruptcy Board of India established under Section 188 of the Code.

Related Provisions

This page is a statutory information resource. The official text, amendments, commencement notifications and applicable rules should be checked for the relevant date and proceeding.