Repayment Plan Regulation 17B – RP Must Seek AA Directions

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  • Last Updated on 23 May, 2025

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IBBI Regulation 17B

Notification No. IBBI/2025-26/GN/REG125; Dated: 19.05.2025

1. What Has Changed?

The Insolvency and Bankruptcy Board of India (IBBI) has inserted a new Regulation 17B into the IBBI (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019 through the Amendment Regulations, 2025 (Notification No. IBBI/2025-26/GN/REG125, dated 19 May 2025).

2. Operational Workflow Under Reg-17B

  • Trigger event – No repayment plan is filed by the debtor within the statutory period.
  • Creditor approval – RP seeks a simple majority consent (by value) of creditors for making an application.
  • Application to AA – RP files Form PG-17B (expected to be notified) stating:
    1. Case details & timelines
    2. Efforts made to procure the plan
    3. Minutes evidencing creditor approval
  • AA’s possible directions –
    1. Grant an ad‐hoc extension for filing the plan, or
    2. Direct the RP to convene creditors’ meeting to decide further action, or
    3. Pass orders for transition to the Bankruptcy Process (s. 121) if revival appears futile.

3. Implications for Key Stakeholders

3.1 Creditors

  • Provides certainty of timeline—they no longer remain in limbo if the debtor is uncooperative.
  • Opportunity to fast-track alternate strategies (e.g., bankruptcy) with AA’s backing.

3.2 Debtors (Personal Guarantors)

  • Signals that inaction now attracts swift judicial attention; may nudge timely cooperation.

3.3 Adjudicating Authority (NCLT)

  • Gains a clear jurisdictional hook to issue time-bound directions, reducing process delays.

4. Action Points for Insolvency Professionals & Lawyers

  1. Amend engagement letters to highlight RP’s obligation under Reg-17B.
  2. Educate guarantors at the first meeting about the consequences of non-submission.
  3. Align case management software to automatically flag Day 22 for possible 17B filing.

5. Conclusion

Regulation 17B plugs a critical procedural gap by compelling the resolution professional—with creditor consent—to approach the Adjudicating Authority whenever a debtor fails to table a repayment plan under Section 105. The move is expected to accelerate personal guarantor resolution timelines and curb tactical delays. All RPs handling such cases should incorporate the new mandate into their standard operating procedures without delay.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied