A key element that differentiates the IBC from previous legislation governing corporate insolvency is the distribution waterfall in the event of liquidation.
A debt arising from an advance payment given to a corporate debtor for the supply of goods or services would be deemed an operational debt.
The National Company Law Tribunal has paved the way for operational creditors to revive their debt and proceed as decree holder.
There is a certainty that the time-barred debt can be revived even after the lapse of an initial period of limitation which is 3 years.
The resolution plan can be challenged by an aggrieved person as per the grounds mentioned in Sub-Section (3) of Section 61 of the Code.