Definition
The process of winding up a company's affairs by selling assets and distributing proceeds to creditors. Under the IBC, liquidation is triggered when the NCLT rejects a resolution plan, the CoC decides to liquidate, or the corporate debtor contravenes the resolution plan. The distribution waterfall under Section 53 of IBC gives secured creditors priority over unsecured creditors.
Related Terms
CIRPSection 53 WaterfallIBC
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Defined by Advocate Subodh Bajpai, Senior Partner, Unified Chambers and Associates