Section 85 in The Insolvency and Bankruptcy Code, 2016

Title: Effect of admission of application.

Description: (1) On the date of admission of the application, the moratorium period shall commence in respect of all the debts. (2) During the moratorium period— (a) any pending legal action or legal proceeding in respect of any debt shall be deemed to have been stayed; and (b) subject to the provisions of section 86, the creditors shall not initiate any legal action or proceedings in respect of any debt. (3) During the moratorium period, the debtor shall— (a) not act as a director of any company, or directly or indirectly take part in or be concerned in the promotion, formation or management of a company; (b) not dispose of or alienate any of his assets; (c) inform his business partners that he is undergoing a fresh start process; (d) be required to inform prior to entering into any financial or commercial transaction of such value as may be notified by the Central Government, either individually or jointly, that he is undergoing a fresh start process; (e) disclose the name under which he enters into business transactions, if it is different from the name in the application admitted under section 84; (f) not travel outside India except with the permission of the Adjudicating Authority. (4) The moratorium ceases to have effect at the end of the period of one hundred and eighty days beginning with the date of admission unless the order admitting the application is revoked under sub-section (2) of section 91.

Title: Objections by creditor and their examination by resolution professional.

Description: (1) Any creditor mentioned in the order of the Adjudicating Authority under section 84 to whom a qualifying debt is owed may, within a period of ten days from the date of receipt of the order under section 84, object only on the following grounds, namely:— (a) inclusion of a debt as a qualifying debt; or (b) incorrectness of the details of the qualifying debt specified in the order under section 84. (2) A creditor may file an objection under sub-section (1) by way of an application to the resolution professional. (3) The application under sub-section (2) shall be supported by such information and documents as may be prescribed. (4) The resolution professional shall consider every objection made under this section. (5) The resolution professional shall examine the objections under sub-section (2) and either accept or reject the objections, within ten days of the date of the application. (6) The resolution professional may examine any matter that appears to him to be relevant to the making of a final list of qualifying debts for the purposes of section 92. (7) On the basis of the examination under sub-section (5) or sub-section (6), the resolution professional shall— (a) prepare an amended list of qualifying debts for the purpose of the discharge order; (b) make an application to the Adjudicating Authority for directions under section 90; or (c) take such other steps as he considers necessary in relation to the debtor.

Title: Application against decision of resolution professional.

Description: (1) The debtor or the creditor who is aggrieved by the action taken by the resolution professional under section 86 may, within ten days of such decision, make an application to the Adjudicating Authority challenging such action on any of the following grounds, namely:— (a) that the resolution professional has not given an opportunity to the debtor or the creditor to make a representation; or (b) that the resolution professional colluded with the other party in arriving at the decision; or (c) that the resolution professional has not complied with the requirements of section 86. (2) The Adjudicating Authority shall decide the application referred to in sub-section (1) within fourteen days of such application, and make an order as it deems fit. (3) Where the application under sub-section (1) has been allowed by the Adjudicating Authority, it shall forward its order to the Board and the Board may take such action as may be required under Chapter VI of Part IV against the resolution professional.

Title: General duties of debtor.

Description: The debtor shall— (a) make available to the resolution professional all information relating to his affairs, attend meetings and comply with the requests of the resolution professional in relation to the fresh start process. (b) inform the resolution professional as soon as reasonably possible of— (i) any material error or omission in relation to the information or document supplied to the resolution professional; or (ii) any change in financial circumstances after the date of application, where such change has an impact on the fresh start process.

Title: Replacement of resolution professional.

Description: (1) Where the debtor or the creditor is of the opinion that the resolution professional appointed under section 82 is required to be replaced, he may apply to the Adjudicating Authority for the replacement of such resolution professional. (2) The Adjudicating Authority shall within seven days of the receipt of the application under sub-section (1) make a reference to the Board for replacement of the resolution professional. (3) The Board shall, within ten days of the receipt of a reference from the Adjudicating Authority under sub-section (2), recommend the name of an insolvency professional to the Adjudicating Authority against whom no disciplinary proceedings are pending. (4) The Adjudicating Authority shall appoint another resolution professional for the purposes of the fresh start process on the basis of the recommendation by the Board. (5) The Adjudicating Authority may give directions to the resolution professional replaced under sub-section (4)— (a) to share all information with the new resolution professional in respect of the fresh start process; and (b) to co-operate with the new resolution professional as may be required.