Corporate and Economic Laws · Insolvency and Bankruptcy Code, 2016

Fast Track and Pre-Packaged Insolvency Resolution under IBC

Updated 11 October 2026 · Fact-checked

Fast track CIRP is a shorter corporate insolvency process for notified debtors, completed within 90 days, extendable once by up to 45 days. Pre-packaged insolvency resolution (PPIRP) lets an eligible MSME, or a defaulting debtor meeting set conditions, agree a base plan with financial creditors before filing. Solve questions by testing eligibility, approvals and timelines.

Understand Fast Track and Pre-Packaged Insolvency Resolution

The normal corporate insolvency resolution process (CIRP) can be slow. The Code therefore offers two quicker routes. Know what each one is, who can use it, and how long it runs.

Fast track CIRP is the process carried out under the fast track Chapter. It is open only to debtors the Central Government has notified. Section 55(2) names three groups: a corporate debtor with assets and income below a notified level; a corporate debtor with a notified class of creditors or amount of debt; and any other notified category of corporate persons. The Code itself gives no figures. The thresholds come from notification, so do not quote numbers unless the question gives them.

The application may be filed by a creditor or by the corporate debtor (Section 57). It must carry proof of default from an information utility or other means the Board specifies, plus other information the Board specifies to show the debtor is eligible.

Pre-packaged insolvency resolution process (PPIRP) works differently. The debtor and its financial creditors agree a base resolution plan first. Only then is the application filed with the Adjudicating Authority. Section 54A(1) lets a corporate debtor classified as a micro, small or medium enterprise under the MSME Development Act, 2006 apply. Section 54A(2) also lets another corporate debtor apply if it has committed a default and meets listed conditions.

The main difference from ordinary CIRP is who drives the start. In PPIRP the debtor and its financial creditors prepare in advance, and the Adjudicating Authority decides on admission within a short period. The PPIRP starts only on admission of the application.

Key rules to remember

Fast track CIRP period: 90 days from the insolvency commencement date (Section 56(1)); The clock runs from the insolvency commencement date.
Fast track extension: CoC resolution with 75% of voting share → RP applies → Adjudicating Authority may extend by not more than 45 days; only once (Section 56); The extension is by the Adjudicating Authority, not the CoC. Total maximum is 90 + 45 = 135 days.
Fast track eligibility (Section 55(2)): Notified: (a) assets and income below a level; (b) class of creditors or amount of debt; (c) other category of corporate persons; Thresholds are notified by the Central Government. The Code gives no figures.
Fast track application (Section 57): Filed by creditor or corporate debtor, with proof of default (information utility or other specified means) and eligibility information; Both parties can file.
PPIRP eligibility: MSME route: Corporate debtor classified as micro, small or medium enterprise under Section 7(1) of MSME Act, 2006 (Section 54A(1)); The default-based route in Section 54A(2) applies without prejudice to this.
PPIRP conditions (Section 54A(2)): No PPIRP or completed CIRP in preceding 3 years; not under CIRP; no liquidation order under Section 33; eligible under Section 29A; Also needed: creditor approval of the IP and director and member approvals.
PPIRP approvals: Unrelated financial creditors holding at least 66% in value approve the IP proposal and the filing; members pass a special resolution (or at least 3/4 of partners pass a resolution); Related parties are excluded from the creditor vote. Majority of directors or partners give a declaration.
Declaration by directors: File within a definite period not exceeding 90 days; not to defraud; name of proposed IP; Made by a majority of directors or partners.
Admission of PPIRP application (Section 54C): Adjudicating Authority decides within 14 days: admit if complete, reject if incomplete; notice gives 7 days to rectify before rejection; PPIRP commences on the date of admission.
Termination of PPIRP (Section 54N): Adjudicating Authority orders termination within 30 days of the RP's application; CoC decision to terminate needs at least 66% of voting shares; The corporate debtor bears the PPIRP costs on termination.
Penalty for fraudulent management (Section 67A): Not less than ₹1,00,000 and up to ₹1,00,00,000; Applies to an officer managing affairs with intent to defraud creditors or for a fraudulent purpose, on and after the PPIRP commencement date, on the RP's application.

How to solve Fast Track and Pre-Packaged Insolvency Resolution questions

Use this order for any fact-based question on fast track or pre-packaged resolution.

1Identify the process asked about: fast track CIRP or PPIRP. Note who is applying.
2Test eligibility. For fast track, ask whether the debtor falls in a notified category. For PPIRP, ask whether it is an MSME, or whether it meets the Section 54A(2) conditions.
3List the approvals required. For PPIRP, check the 66% financial creditor approval (unrelated creditors only), the special resolution of members or 3/4 of partners, and the directors' declaration.
4Check the documents filed with the application: proof of default for fast track; for PPIRP the declarations, approvals, IP consent and report, and the avoidance transaction declaration.
5Apply the timelines: 90 days plus up to 45 days once for fast track; 14 days for PPIRP admission with 7 days to rectify defects.
6Look for disqualifiers: a CIRP or PPIRP within three years, a liquidation order, ineligibility under Section 29A.
7State the conclusion in one line, then give the section number as support.

Quickest way: Process, Eligibility, Clock

When to use it: Use it for MCQs and short case questions where you must decide whether a debtor qualifies or whether a date is within time.

Name the process. If it says 'pre-pack' or 'base plan', it is PPIRP; otherwise fast track.
Check eligibility in one pass: notified category for fast track; MSME or the four negative conditions for PPIRP.
Match the number to the process: 90 and 45 days, 75% for fast track extension; 66% for PPIRP approvals; 14 and 7 days for PPIRP admission.
Eliminate options that mix the numbers between the two processes.

Common mistakes in Fast Track and Pre-Packaged Insolvency Resolution

Saying the fast track period can be extended by the CoC alone.
Students remember the 75% vote and forget who grants the extension.
Fix: The CoC only instructs the RP by a 75% resolution. The RP applies and the Adjudicating Authority grants the extension, by up to 45 days, once.
Quoting fixed asset or income limits for fast track eligibility from memory.
Notified figures are often repeated in notes.
Fix: Section 55(2) leaves the levels to Central Government notification. Write that eligibility depends on notified categories unless the question states the figures.
Treating PPIRP as open only to MSMEs.
Section 54A(1) is the first thing students read.
Fix: Section 54A(2) also allows other corporate debtors that have defaulted and meet the stated conditions. MSME status is one route.
Counting related-party creditors in the 66% approval.
Students use the general creditor vote idea.
Fix: The 66% is of financial debt due to financial creditors who are not related parties of the debtor.
Writing 90 days as the extension limit for PPIRP admission, or mixing it with the fast track period.
Both processes have short time limits.
Fix: The fast track completion limit is 90 days. The 90 days in PPIRP is the maximum time the debtor's declaration may give for filing. Admission is decided within 14 days.
Saying PPIRP begins when the creditors approve the base plan.
The pre-agreed plan seems to start the process.
Fix: PPIRP commences on the date the Adjudicating Authority admits the application under Section 54C.

Worked examples

Example 1

A fast track CIRP of a notified corporate debtor began on the insolvency commencement date of 1 March. The CoC resolves with 80% of voting share to seek more time. State the maximum time available and the process to obtain it.

Show the solution

The basic period is 90 days from the insolvency commencement date (Section 56(1)).
An extension needs a CoC resolution supported by 75% of the voting share. 80% meets this.
The RP, instructed by the resolution, applies to the Adjudicating Authority.
If satisfied that the case cannot be completed in 90 days, the Adjudicating Authority may extend by a further period not exceeding 45 days.
An extension cannot be granted more than once. Maximum total is 90 + 45 = 135 days.

Answer: The process can run up to 135 days from the insolvency commencement date, if the RP applies and the Adjudicating Authority grants the single extension of up to 45 days.

Example 2

Ashoka Components Pvt Ltd, a small enterprise under the MSME Act, 2006, wants to start PPIRP. Unrelated financial creditors holding 70% of the financial debt owed to such creditors approve the filing. State what else is needed and what the Adjudicating Authority will do after filing.

Show the solution

Eligibility: as an MSME, it can apply under Section 54A(1).
Creditor approval: 70% is at least 66% in value of debt due to unrelated financial creditors, so this requirement is met.
Other requirements: the unrelated financial creditors must also have approved the proposed insolvency professional, and the base resolution plan must be given to creditors before approval.
Corporate approvals: a majority of directors must make the declaration, and members must pass a special resolution.
Filing: the application goes with the declarations, approvals, the IP's consent and report, and the avoidance transaction declaration (Section 54C(3)).
The Adjudicating Authority decides within 14 days. It admits a complete application and rejects an incomplete one, after giving notice to rectify within 7 days.
PPIRP commences on admission.

Answer: Ashoka needs the IP approval, directors' declaration, members' special resolution, and a base plan given to creditors. The Adjudicating Authority must admit or reject within 14 days, and the process starts on admission.

Exam tips

Keep a two-column revision table of fast track and PPIRP: eligibility, who applies, key numbers, who decides.
In MCQs, check which percentage goes with which process: 75% for fast track extension, 66% for PPIRP approvals and termination.
In case scenarios, check the negative conditions in Section 54A(2), such as a CIRP completed within three years.
Write section numbers you are sure of, such as 54A, 54C, 55, 56, 57, 54N and 67A.
For a comparison question, compare with ordinary CIRP on who starts it, eligibility and speed.

Practice questions from Insolvency and Bankruptcy Code, 2016

Fast Track and Pre-Packaged Insolvency Resolution in other exams

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

CS ProfessionalFast Track Corporate Insolvency Resolution Process

Fast Track and Pre-Packaged Insolvency Resolution: frequently asked questions

Who can apply for fast track CIRP?

A creditor or the corporate debtor can apply, along with proof of default and eligibility information. The debtor must fall in a category notified by the Central Government under Section 55(2).

How long does fast track CIRP take?

It must be completed within 90 days from the insolvency commencement date. The Adjudicating Authority may extend it once by up to 45 days, on an application backed by a 75% CoC vote.

Is PPIRP only for MSMEs?

No. MSMEs can apply under Section 54A(1). Other corporate debtors that have defaulted may also apply if they meet the Section 54A(2) conditions.

When does PPIRP begin?

It begins on the date the Adjudicating Authority admits the application. The Authority must admit or reject within 14 days of receiving it.

What happens if an officer acts fraudulently during PPIRP?

On the RP's application, the Adjudicating Authority can impose a penalty of not less than ₹1,00,000 and up to ₹1,00,00,000 under Section 67A.