Insolvency and Bankruptcy - Law and Practice · Resolution Strategies (Elective 7.5)

Continuation of Process and Role of the Committee of Creditors in CIRP

Updated 11 October 2026 · Fact-checked

During CIRP, the resolution professional conducts every committee of creditors meeting, gives notice, fixes voting shares and runs the process. The committee can replace the professional under section 27 by a 66% vote of voting shares, with written consent from the proposed professional. The Adjudicating Authority forwards the name to the Board for confirmation.

Understand Continuation of Process and Committee of Creditors Role

A corporate insolvency resolution process (CIRP) is run by a resolution professional (RP), but the key decisions belong to the committee of creditors (CoC). The RP is the manager and the CoC is the decision-maker. You must keep this split clear in every answer.

Section 24 governs meetings. Members may meet in person or by specified electronic means. All meetings are conducted by the RP. The RP gives notice to CoC members (including authorised representatives), to the members of the suspended Board of Directors or the partners, and to operational creditors or their representatives whose aggregate dues are not less than ten per cent of the debt. Directors, partners and one representative of operational creditors may attend but have no right to vote. Their absence does not invalidate the meeting.

Voting follows money. Each creditor votes by the voting share assigned to it based on the financial debts owed to it. The RP determines these shares in the manner specified by the Board. A CoC member may appoint an insolvency professional other than the RP to represent it, subject to section 21(6), (6A) and (6B). That representative's fees are borne by that creditor.

The CoC can also decide the RP must go. Under section 27, if the CoC thinks the RP appointed under section 22 should be replaced, it may do so at a meeting by a vote of 66% of voting shares, with written consent from the proposed professional in the specified form. It forwards the name to the Adjudicating Authority, which sends it to the Board for confirmation. The new RP is then appointed in the same manner as in section 16. The process continues without restarting.

Continuity matters. Under section 27(5), the existing RP continues until the new professional is appointed, so there is no gap in control of the corporate debtor. Note the official text of sub-section (5) refers to pending disciplinary proceedings against the proposed professional. Use the wording of the text carefully and do not add detail it does not give.

Key rules to remember

Replacement of RP in CIRP (section 27): CoC vote ≥ 66% of voting shares + written consent of proposed RP; Passed at a CoC meeting. The CoC forwards the name to the Adjudicating Authority, which forwards it to the Board for confirmation.
Who conducts CoC meetings (section 24(2)): All CoC meetings are conducted by the resolution professional; The RP also gives notice and determines voting shares as specified by the Board.
Notice recipients (section 24(3)): CoC members and authorised representatives + suspended directors or partners + operational creditors holding ≥ 10% of the debt; Directors, partners and one operational creditor representative may attend but cannot vote.
Voting share (section 24(6)): Voting share ∝ financial debt owed to the creditor; Each creditor votes in accordance with the share assigned to it.
Continuation during replacement (section 27(5)): Existing RP continues until another professional is appointed; Ensures the process is not left without a professional.
Replacement in individual insolvency (sections 89 and 98): Application to AA → AA refers to Board within 7 days → Board recommends within 10 days; Section 98(5) and (6) give a second route where the Board confirms or rejects a nominated professional within 10 days.
Replacement of bankruptcy trustee (section 145): CoC vote of 75% of voting share; AA directs Board within 7 days; Board recommends within 10 days; AA appoints within 14 days; Do not mix this 75% with the 66% in section 27.

How to solve Continuation of Process and Committee of Creditors Role questions

Use this method for any question on the RP, the CoC or replacement. Keep the answer in the order: provision, facts, conclusion.

1Identify the stage and the person: is it corporate CIRP, pre-packaged process, fresh start, individual insolvency or bankruptcy? The section depends on this.
2State the rule in plain words with the section number, such as section 24 for meetings or section 27 for replacement.
3List the facts that matter: who gave notice, who attended, the vote percentage, whether consent was given.
4Apply the numbers. Check the voting threshold against voting shares, not the number of creditors.
5Trace the procedure: CoC to Adjudicating Authority, then Board for confirmation, then appointment.
6Say who acts in the meantime. The existing RP continues under section 27(5).
7Conclude clearly: valid or invalid, replaced or not, and the next step. Add a practical compliance point such as minutes or written consent.

Quickest way: Three-question check for replacement and meeting problems

When to use it: Use it for short-answer questions or when time is low in a case-based paper.

Who decides? The CoC, by vote of voting shares. Who conducts the meeting? The RP.
What threshold applies? 66% for replacing an RP in CIRP under section 27; 75% for proposing to replace a bankruptcy trustee under section 145.
What happens next? Name goes to the Adjudicating Authority and the Board, and the existing RP continues until the new one is appointed.

Common mistakes in Continuation of Process and Committee of Creditors Role

Saying the CoC replaces the RP by a simple majority.
Students remember that the CoC decides by vote but forget the threshold.
Fix: Write 66% of voting shares for section 27, backed by written consent of the proposed professional.
Treating directors and operational creditor representatives as voting members.
They receive notice and attend, so students assume they vote.
Fix: Under section 24(4) they may attend but have no right to vote. Their absence does not invalidate the meeting.
Counting heads instead of voting shares.
Students apply a company-meeting mindset.
Fix: Section 24(6) allocates votes by financial debt owed. Always compute percentage of voting share.
Confusing the 66% for RP replacement with the 75% for bankruptcy trustee replacement.
Both sections have similar titles and wording.
Fix: Link 66% to section 27 (CIRP) and 75% to section 145 (bankruptcy trustee). Note the sections 89 and 98 route is by application, not CoC vote.
Saying the replaced RP leaves immediately.
Students assume the CoC resolution takes effect at once.
Fix: The CoC resolution only starts the process. The Board confirms and the new RP is appointed as in section 16. The existing RP continues until then.
Saying the RP attends meetings but the CoC conducts them.
Students think the CoC runs its own meetings.
Fix: Section 24(2): all CoC meetings are conducted by the RP.

Worked examples

Example 1

The CoC of Sundaram Textiles Ltd, under CIRP, has financial creditors with voting shares of 40%, 30%, 20% and 10%. The creditors holding 40% and 30% vote to replace the RP with CA Rao, who has given written consent. The 20% and 10% creditors vote against. Can the RP be replaced?

Show the solution

Rule: under section 27(2), the CoC may replace the RP at a meeting by a vote of 66% of voting shares, subject to written consent of the proposed professional.
Facts: votes in favour = 40% + 30% = 70% of voting shares. Written consent from CA Rao is given.
Compare: 70% is not less than 66%, so the threshold is met.
Procedure: the CoC forwards CA Rao's name to the Adjudicating Authority, which forwards it to the Board for confirmation. CA Rao is appointed in the same manner as in section 16.
Interim position: under section 27(5), the existing RP continues until the new professional is appointed.

Answer: Yes. The resolution passes with 70% of voting shares, which exceeds 66%. The RP is replaced once the Board confirms and the new RP is appointed. Until then the existing RP continues.

Example 2

At a CoC meeting of Meera Steels Ltd, the RP gave notice to CoC members, to the suspended directors, and to an operational creditor group holding 6% of the debt. No director attended. A creditor says the meeting is invalid. Advise.

Show the solution

Rule: under section 24(3), the RP gives notice to CoC members, suspended directors or partners, and operational creditors or their representatives if aggregate dues are not less than 10% of the debt.
Check the notice: the operational creditor group holds 6%, which is below 10%. The Code did not require notice to it.
Directors: section 24(4) lets them attend but not vote. The proviso says their absence does not invalidate the proceedings.
Conduct: the meeting was conducted by the RP, as section 24(2) requires.
Conclusion: no ground of invalidity arises from the facts given.

Answer: The objection fails. Absence of directors does not invalidate the meeting, and notice to an operational creditor group holding less than 10% was not mandatory. The meeting stands, assuming proper notice to CoC members.

Exam tips

Write the section number and threshold in the first line. Examiners look for 66% for section 27 and 75% for section 145.
In case questions, calculate the voting percentage and show it. A clear number earns marks even if the final view is debated.
Always cover the full replacement chain: CoC vote, consent, Adjudicating Authority, Board, appointment, and continuity of the existing RP.
Separate corporate CIRP (section 27), individual insolvency (sections 89 and 98) and bankruptcy (section 145). Do not mix their procedures.
Add a short compliance point: written consent in the specified form, minutes of the meeting and intimation to the Adjudicating Authority.

Practice questions from Resolution Strategies (Elective 7.5)

Continuation of Process and Committee of Creditors Role in other exams

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

CMA FinalCommittee of Creditors and Resolution Plan

Continuation of Process and Committee of Creditors Role: frequently asked questions

What vote is needed to replace a resolution professional under section 27?

The CoC must resolve at a meeting by a vote of 66% of voting shares. The proposed professional must give written consent in the specified form.

Who conducts committee of creditors meetings?

The resolution professional conducts all meetings under section 24(2). The RP gives notice, and determines each creditor's voting share in the manner specified by the Board.

Can suspended directors vote at CoC meetings?

No. They may attend, but they have no right to vote. Their absence does not invalidate the meeting.

Does the old RP stop work once the CoC resolves to replace?

No. Under section 27(5) the existing RP continues until another professional is appointed. The new RP is appointed after the Adjudicating Authority and Board steps are completed.