Dear Sir,

You are suggested to give some more details regarding the case. If you wish to know in general, the same may be found even on internet, the various gazette notifications and laws/rules on the subject on internet also. 

Declaring insolvent means all your assets will sold first including house and when u will left with nothing than will declare insolvent.

You can file petition under provisions of provincial insolvency act for declaration that you are insolvent 

2) The district court has the jurisdiction to try cases pertaining to insolvency under the Act. When an order of insolvency is passed, all personal properties of the individual are vested in the Official Assignee appointed by the government of India, who then realizes it and allocates it among the creditors of the insolvent

Individual can file insolvency and bankruptcy before the district court under provincial insolvency act . The list of creditors can be attached along with debt and all the worksheet to petition can be annexed.

1. Individual who has obtained "Insolvency Order", from Court, it protected from any type of prosecution, from future legal litigation, for his property/s held before date of order.

It's filed under provincial insolvency Act 1920. Still the individual bankruptcy is not covered under IBC code

There are so many ways so for insolvency what is exact root cause and for what purpose loan or finance was taken on what return conditions.

There are many online book on Insolvency and Bankruptcy Code is available apart from study material. 

If you are required to file any case then do so with the help of an advocate only. 

Ans: Filing of insolvency of an individual person is to be done in the High Court of the appropriate jurisdiction. After you file an application for insolvency, the court considers all the assets available with you and only if found then pronounces an individual as an insolvent. 

You shall not have any assets in your name except some necessary belongings. 

You can restart your activities in normal way. 

1. you can go for filing a the insolvency petition in the concerned District Court,

2. for reference go through the below link

https://www.icsi.edu/media/webmodules/ILP_Study_with_TP.pdf

An application has to be filed before the District Judge, of your area seeking to declare individual as Insolvent, under the Insolvency Act, 1920.

On passing the orders of Insolvency by the Court, the properties of the said individual will vest in the Official Assignee Appointed by Government of India.

The said official distribute the proceeds of such properties of individual by allotting the same to creditors of declared Insolvent. 

Insolvency is the inability to pay debts when they are due.

You can be insolvent without being bankrupt, but you can’t be bankrupt without being insolvent.

Insolvency is a problem that bankruptcy is designed to solve.

Insolvency only becomes an issue when a creditor seeks to collect and the debtor can’t pay what’s due. Failing to pay debts usually leads to debt collection efforts that force some kind of action.

Insolvency is not the same as bankruptcy. Insolvency is a state of economic distress, whereas bankruptcy is a court order that decides how an insolvent debtor will deal with unpaid obligations. That usually involves selling assets to pay the creditors and erasing debts that can’t be paid. Bankruptcy can severely damage a debtor’s credit rating and ability to borrow for years.

An individual or company can be insolvent without being bankrupt — especially if the insolvency is temporary and correctable — but not the opposite.

Insolvency can lead to bankruptcy if the insolvent party is unable to successfully address its financial condition.

If you are financially overwhelmed and sure you can’t pay your debts, you should contact a non-profit debt counsellor or debt management company that can help you review your balance sheet. Even if you don’t have enough income to pay your debts, a debt manager can try to negotiate a settlement that will partially repay what you owe and avoid a bankruptcy filing.

You can also try to negotiate with creditors on your own. If you owe a large credit-card debt, contact the card issuer and explain your situation. Though the debt holder is under no obligation to offer a workout plan, reduce your debt or trim you interest rate, it’s in their best interests to try. So, you might be able to reach an agreement if you can convince the creditor that it’s either an agreement or default.

The Insolvency And Bankruptcy Code, 2016 - Key Highlights

Dear Sir,

The provisions of  Bankruptcy and insolvency Act may be used to get relevant certificate. The highlights of the Act are as follows followed by a link.

KEY HIGHLIGHTS

1. Corporate Debtors: Two-Stage Process

To initiate an insolvency process for corporate debtors, the default should be at least INR Ten lakhs which limit may be increased up to INR Ten lakhs by the Government). The Code proposes two independent stages:

Insolvency Resolution Process, during which financial creditors assess whether the debtor's business is viable to continue and the options for its rescue and revival; and

Liquidation, if the insolvency resolution process fails or financial creditors decide to wind down and distribute the assets of the debtor.

(a) The Insolvency Resolution Process (IRP)

The IRP provides a collective mechanism to lenders to deal with the overall distressed position of a corporate debtor. This is a significant departure from the existing legal framework under which the primary onus to initiate a reorganisation process lies with the debtor, and lenders may pursue distinct actions for recovery, security enforcement and debt restructuring.

The Code envisages the following steps in the IRP:

(i) Commencement of the IRP

A financial creditor (for a defaulted financial debt) or an operational creditor (for an unpaid operational debt) can initiate an IRP against a corporate debtor at the National Company Law Tribunal (NCLT).

The defaulting corporate debtor, its shareholders or employees, may also initiate voluntary insolvency proceedings.

(ii) Moratorium

The NCLT orders a moratorium on the debtor's operations for the period of the IRP. This operates as a 'calm period' during which no judicial proceedings for recovery, enforcement of security interest, sale or transfer of assets, or termination of essential contracts can take place against the debtor.

(iii) Appointment of Resolution Professional

The NCLT appoints an insolvency professional or 'Resolution Professional' to administer the IRP. The Resolution Professional's primary function is to take over the management of the corporate borrower and operate its business as a going concern under the broad directions of a committee of creditors. This is similar to the approach under the UK insolvency laws, but distinct from the "debtor in possession" approach under Chapter 11 of the US bankruptcy code. Under the US bankruptcy code, the debtor's management retains control while the bankruptcy professional only oversees the business in order to prevent asset stripping on the part of the promoters.

Therefore, the thrust of the Code is to allow a shift of control from the defaulting debtor's management to its creditors, where the creditors drive the business of the debtor with the Resolution Professional acting as their agent.

Part III of the Insolvency and Bankruptcy Code, 2016, deals with insolvency and bankruptcy of individuals and partnership firms.

According to a statement issued by IBBI on Tuesday, the draft rules and regulations have been submitted by a working group which was formed to recommend the strategy and approach for implementation of the provisions of the Insolvency and Bankruptcy Code, 2016, dealing with insolvency and bankruptcy in respect of guarantors to corporate debtors, i.e., personal guarantors, and individuals having businesses.

http://www.mondaq.com/india/x/492318/Insolvency+Bankruptcy/The+Insolvency+And+Bankruptcy+Code+2016+Key+Highlights

To
All Registered Insolvency Professionals
All Registered Insolvency Professional Agencies
(By mail to registered email addresses and on web site of the IBBI)

Dear Madam / Sir,

Sub: Fees payable to an insolvency professional and to other professionals appointed by an insolvency professional.

Section 206 of the Insolvency and Bankruptcy Code, 2016 (Code) provides that only a person registered as an insolvency professional with the Insolvency and Bankruptcy Board of India (IBBI) can render services as an insolvency professional under the Code. Section 23 read with section 5(27) of the Code requires that an insolvency professional, who is appointed as an interim resolution professional or a resolution professional, shall conduct the entire corporate insolvency resolution process, including fast track process. In terms of section 5(13) of the Code, ‘the fees payable to any person acting as a resolution professional’ is included in ‘insolvency resolution process cost’, which needs to be paid in priority.

1. The Code of Conduct for Insolvency Professionals under the IBBI (Insolvency Professionals) Regulations, 2016 require that an insolvency professional must provide services for remuneration which is charged in a transparent manner, and is a reasonable reflection of the work necessarily and properly undertaken. He shall not accept any fees or charges other than those which are disclosed to and approved by the persons fixing his remuneration.
2. In view of the above, it is clarified that an insolvency professional shall render services for a fee which is a reasonable reflection of his work, raise bills / invoices in his name towards such fees, and such fees shall be paid to his bank account. Any payment of fees for the services of an insolvency professional to any person other than the insolvency professional shall not form part of the insolvency resolution process cost.
3. Similarly, any other professional appointed by an insolvency professional shall raise bills / invoices in his / its (such as registered valuer) name towards such fees, and such fees shall be paid to his / its bank account.
4. This circular is issued in exercise of powers under section 196 read with section 208 of the Insolvency and Bankruptcy Code, 2016.

Yours faithfully,

-Sd-
(I. Sreekara Rao)
Deputy General Manager
Email: [deleted]

 -When a person does not have enough assets to pay all of their debts, and exhaust all the sources of fund and finding himself at a dead end. In such situations, then he has only recourse to file an insolvency Petition before the court of law.

- As per law, an individual can file an insolvency petition if he fulfills the following conditions:- 

1. He is under threat of arrest or imprisonment in execution of a money decree.

2. Debt amounts to Rs.500 or more

3. There is a subsisting order of attachment against his property.

- And a creditor can file insolvency petition if :- 

1. The debts amounts to INR 500 or more.

2. The debt is already due.

- The Insolvency petition should be filed within three months of the act of insolvency before the the district court.

- Further , on filing the application for becoming insolvent , court appoints an officer for preparing a list of Assets and Liabilities of that person who wants to be an insolvent.

- Further , the distribution of assets of an insolvent individual executes as per the priority of debt provided by the Provincial Insolvency Act of 1920 as under :-

1..Debts due to the local government or any local authority

2. Salary or wages, not exceeding Rs.20, of any clerk, servant or labourer, for services rendered to the insolvent individual during four months preceding the date of presentation of insolvency petition.

3. Rent due to the landlord, for an amount not exceeding one month’s rent.

There are many books and article available online on Insolvency. 

https:// www. lawyered.in/legal-disrupt/articles/how-you-can-file-insolvency-petition/

1. Implications of filing insolvency is that you have to disclose all your assets and liabilities in the petition. 

2. Court will appoint reciever for liquidation of assets and clear the liabilities.

3. You can go through this link https://www.indiafilings.com/learn/file-insolvency-petition/

1. Bankrupt individuals may file a petition for their individual bankruptcy if they are unable to pay their debts. Insolvency proceedings against individuals are governed by the Presidency Towns Insolvency Act, 1909 in case of insolvency proceedings before the High Courts of Mumbai, Calcutta and Chennai and the Provincial Insolvency Act,1920 in other cases.

2. The debtor (borrower), has to file a petition before the designated insolvency court to declare him insolvent. He can do this if he is unable to pay his debts when due, when he is under arrest or imprisonment in execution of the decree of any court for the payment of money, or when an order of attachment is subsisting against his property. Similarly a creditor, who has a decree or an award of recovery of a certain amount, can also file a petition against the debtor in case his assets are not enough to pay off the debt. The insolvency laws protect the debtor from harassment by all creditors and the creditors get equitable distribution of the debtor's assets.

3. On being declared insolvent by the competent court, his property vests with the receiver or the official assignee (who is assigned by the court) for the purpose of distribution among the creditors. He will have to submit his IT returns, bank statements, ledger book, cheque book and all other documents to prove his net worth. This will be handed over to the official assignee or receiver who will take charge of the assets, evaluate them and realise them for distribution. 'Property' would include anything that is in the debtor's name - house, car, shares or any other investments that can be converted into cash. In case the debtor acquires a property, wins a lottery or receives an inheritance during insolvency proceedings and before he is discharged, even that would be used for the purpose of distribution among the creditors.

4. On the commencement of insolvency proceedings before it, the court will publish the filing and pendency of the petition in regional and national lever newspapers so that all creditors of the petitioner get a general notice and thus an opportunity to contest the petition. If the creditors do not come to claim their share, once the insolvent is discharged, he is under no obligation to pay any creditor(s). Debts that a creditor can prove to the satisfaction of the official receiver or assignee will be taken into account.

5. After deducting the court's expenses for realisation of money out of the assets, it will be distributed among the unsecured creditors. The secured creditor will first have to realise the security. Since in most cases, the assets of the insolvent cannot satisfy all the debts, the percentage of the settlement to the creditors will depend squarely on the amount realised by the official assignee appointed by the court. 

6. The consequences of being declared insolvent can be disastrous. An individual on being declared as insolvent, cannot be appointed a director of a company or a partner in a firm. He is also disqualified from contesting elections or holding any public office throughout the territory of India. The insolvent is also debarred from entering into any contract or agreement. The insolvent will not be given credit by any public or finance institutions if the order of insolvency attains finality. These disqualifications can be purged by him only when he obtains an order of discharge from the competent court.

The Insolvency and Bankruptcy code at present can only be triggered if there is a minimum default of Rs 1 lakh. This process can be triggered by way of filing an application before the National Company Law Tribunal (NCLT). The process can be initiated by two classes of creditors which would include financial creditors and operational creditors. But for the application to be admitted, the creditor will have to show that a requisite default is ascertainable.

Another important aspect that has to be seen in respect of Insolvency and Bankruptcy Code (IBC) is that at present only companies (both private and public limited company) and Limited Liability Partnerships (LLP) can be considered as defaulting corporate debtors. This code also contains provisions in respect of individual insolvency, but these provisions have not been notified they have consequently not come into force yet. Therefore cases relating to unpaid debts against individuals and partnership firms would fall outside the purview of this code.