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Corporate and Economic Laws · Insolvency and Bankruptcy Code, 2016

Committee of Creditors and Resolution Plan under IBC

Updated 11 October 2026 · Fact-checked

The committee of creditors (CoC) is the body of financial creditors that decides the fate of a corporate debtor in CIRP. The resolution professional checks each plan against section 30(2), then the CoC approves one by at least 66% of voting share. The plan then goes to the Adjudicating Authority.

Understand Committee of Creditors and Resolution Plan

When a company enters the corporate insolvency resolution process (CIRP), control of the business shifts. Its board is displaced and a resolution professional (RP) runs the process. The key decision is not taken by the RP or the court first. It is taken by the committee of creditors (CoC), which is made up of the financial creditors of the company.

The CoC decides by voting. Each financial creditor votes according to its voting share, which reflects the debt owed to it. Under section 30(4), a resolution plan is approved by a vote of not less than 66% of the voting share of the financial creditors. The CoC must consider the plan's feasibility and viability, and the manner of distribution proposed. It may take into account the order of priority in section 53(1), including the priority and value of the security interest of a secured creditor.

The RP is a filter and a coordinator. A resolution applicant submits a plan to the RP, prepared on the basis of the information memorandum, along with an affidavit stating that the applicant is eligible under section 29A. The RP examines each plan and places before the CoC only those plans that meet the conditions in section 30(2). The RP then submits the plan approved by the CoC to the Adjudicating Authority (section 30(6)).

So the flow is: applicant submits plan, RP checks compliance, CoC votes at 66%, RP sends the approved plan to the Adjudicating Authority. The resolution applicant may attend the CoC meeting where its plan is considered, but has no vote unless it is also a financial creditor (section 30(5)).

The payment rules protect those who do not sit on the CoC. Operational creditors and dissenting financial creditors must receive at least a floor amount linked to what they would get in liquidation. This is what students call the waterfall link.

Key rules to remember

Submission of plan (section 30(1))
Resolution applicant → RP, with affidavit of eligibility under section 29A
The plan is prepared on the basis of the information memorandum.
CoC approval threshold (section 30(4))
Approval needs ≥ 66% of voting share of the financial creditors
It was 75% earlier and is now 66%. Operational creditors do not vote as a rule. The CoC must consider feasibility, viability and the manner of distribution.
Section 30(2) checks by RP
(a) CIRP costs paid in priority; (b) operational creditors and dissenting financial creditors paid at least the floor; (c) management after approval; (d) implementation and supervision; (e) no contravention of law; (f) other Board requirements
Only plans that confirm to these conditions go to the CoC under section 30(3).
Floor for operational creditors (section 30(2)(b))
Payment ≥ higher of (i) liquidation value under section 53, or (ii) amount if the plan's distributable amount were paid per section 53(1) priority
Distribution must be fair and equitable (Explanation 1).
Floor for dissenting financial creditors
Payment ≥ amount they would get under section 53(1) in liquidation
This applies to financial creditors who do not vote in favour of the plan.
Pre-packaged route (section 54K)
Base plan submitted within 2 days of pre-packaged insolvency commencement date; CoC approval by ≥ 66% of voting shares
The CoC may approve the base plan only if it does not impair operational creditors' claims. Sections 30(1), (2) and (5) apply mutatis mutandis.

How to solve Committee of Creditors and Resolution Plan questions

Use this order for any question on CoC and resolution plan, whether theory or case-based.

  1. 1Identify the stage: plan submission, RP examination, CoC voting, or submission to the Adjudicating Authority.
  2. 2Name the actor and the power. The applicant submits, the RP examines and presents, the CoC approves, the RP files with the Adjudicating Authority.
  3. 3Test the plan against section 30(2)(a) to (f) one by one. Write each condition you check.
  4. 4For payment questions, compute the liquidation entitlement under section 53(1) and compare it with the plan payout to operational and dissenting financial creditors.
  5. 5For voting, compute the share as: votes in favour ÷ total voting share of financial creditors, and compare with 66%.
  6. 6State the conclusion clearly: plan eligible or not, approved or not, and what must be changed.
  7. 7Cite the section number only where you are certain of it.

Quickest way: Three-gate check

When to use it: Use it in MCQs and short case scenarios when time is tight.

  1. Gate 1, RP: does the plan meet section 30(2)? If not, it never reaches the CoC.
  2. Gate 2, CoC: are votes in favour at least 66% of voting share of financial creditors? Ignore operational creditors' votes and the applicant's vote unless it is a financial creditor.
  3. Gate 3, floor: do operational and dissenting financial creditors get at least their liquidation entitlement? If not, the plan fails section 30(2)(b).
  4. If all three pass, the RP submits the plan to the Adjudicating Authority.

Common mistakes in Committee of Creditors and Resolution Plan

  • Stating the approval threshold as 75%.

    Older material and the original Code used 75%.

    Fix: Write 66% of voting share of financial creditors, as in section 30(4) as amended.

  • Saying the RP approves the plan.

    The RP does most of the work, so students assume it decides.

    Fix: The RP only examines compliance and presents plans. The CoC approves. The Adjudicating Authority then considers the approved plan.

  • Giving the resolution applicant a vote.

    The applicant attends the meeting, so students think it votes.

    Fix: Under section 30(5) the applicant may attend but has no vote unless it is also a financial creditor.

  • Treating the 66% as 66% of members present.

    Company meeting rules use majorities of those present and voting.

    Fix: The test is a share of the total voting share of the financial creditors, not of those who attend.

  • Paying operational creditors only the liquidation value.

    Students forget the second limb of section 30(2)(b).

    Fix: The floor is the higher of the liquidation amount and the amount under the section 53(1) order applied to the plan's distributable amount.

  • Forgetting that CIRP costs get priority.

    Focus stays on creditor payouts.

    Fix: Section 30(2)(a) requires CIRP costs to be paid in priority to other debts.

Worked examples

Example 1

Aarav Steels Ltd is in CIRP. Its CoC has financial creditors with voting shares: Bank A 40%, Bank B 30%, NBFC C 20%, Fund D 10%. A resolution plan receives votes in favour from Bank A and Bank B only. Can the CoC approve it? Would the answer change if NBFC C also voted in favour?

Show the solution
  1. Approval needs not less than 66% of voting share of financial creditors (section 30(4)).
  2. Votes in favour with A and B: 40% + 30% = 70%.
  3. 70% is at least 66%, so the plan is approved by the CoC, provided the RP had confirmed section 30(2) conditions.
  4. If C also voted in favour, the total would be 90%, which is also above 66%.
  5. So the answer does not change on the approval question. Approval does not depend on C's vote.

Answer: The plan is approved with 70% of voting share. NBFC C and Fund D, as dissenting creditors, must still receive at least their liquidation entitlement under section 53(1). The answer does not change if C also votes in favour.

Example 2

A resolution plan for Bharat Textiles Ltd offers operational creditors ₹8,00,000. In liquidation under section 53 they would receive ₹6,00,000. If the plan's distributable amount were paid in the section 53(1) order, they would receive ₹9,50,000. Does the plan satisfy section 30(2)(b) for operational creditors?

Show the solution
  1. The floor is the higher of (i) the liquidation amount and (ii) the amount under the section 53(1) order applied to the plan's distributable amount.
  2. (i) = ₹6,00,000. (ii) = ₹9,50,000.
  3. Higher of the two = ₹9,50,000.
  4. The plan offers ₹8,00,000, which is less than ₹9,50,000.
  5. So the plan does not meet the condition. The RP should not present it to the CoC in this form.

Answer: No. The minimum payable is ₹9,50,000, but the plan offers ₹8,00,000, a shortfall of ₹1,50,000. The plan must be revised.

Exam tips

  • Memorise the six conditions of section 30(2) as a list and write them in order in long answers.
  • In case scenarios, always compute the voting percentage over total voting share of financial creditors and compare it with 66%.
  • Keep roles separate in your answer: applicant submits, RP examines and presents, CoC approves, RP files with the Adjudicating Authority.
  • For payment questions, show both limbs of the operational creditors' floor and pick the higher one.
  • Link to pre-packs: base plan within two days of commencement, with approval by 66% as well.

Practice questions from Insolvency and Bankruptcy Code, 2016

Committee of Creditors and Resolution Plan in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Committee of Creditors and Resolution Plan: frequently asked questions

What vote is needed to approve a resolution plan under IBC?

Not less than 66% of the voting share of the financial creditors in the CoC. This is in section 30(4). The CoC must first consider feasibility, viability and the manner of distribution.

What does the resolution professional check in a resolution plan?

The RP confirms that the plan meets section 30(2). It must pay CIRP costs in priority, meet the floor for operational and dissenting financial creditors, provide for management, implementation and supervision, not contravene any law, and meet other Board requirements.

Can the resolution applicant vote in the CoC meeting?

No, unless it is also a financial creditor. It may attend the meeting in which its plan is considered, as per section 30(5).

How is the waterfall relevant to a resolution plan?

The CoC may consider the section 53(1) order of priority, including the priority and value of a secured creditor's security interest, when deciding on distribution. The plan must also give operational creditors and dissenting financial creditors at least their liquidation-based floor.