(1) A bankrupt, from the bankruptcy commencement date, shall
(a) not act as a director of any company, or directly or indirectly take part in or be concerned in the promotion, formation or management of a company;
(b) without the previous sanction of the bankruptcy trustee, be prohibited from creating any charge on his estate or taking any further debt;
(c) be required to inform his business partners that he is undergoing a bankruptcy process;
(d) prior to entering into any financial or commercial transaction of such value as may be prescribed, either individually or jointly, inform all the parties involved in such transaction that he is undergoing a bankruptcy process;
(e) without the previous sanction of the Adjudicating Authority, be incompetent to maintain any legal action or proceedings in relation to the bankruptcy debts; and
(f) not be permitted to travel overseas without the permission of the Adjudicating Authority.
(2) Any restriction to which a bankrupt may be subject under this section shall cease to have effect, if--
(a) the bankruptcy order against him is modified or recalled under section 142; or
(b) he is discharged under section 138.
(a) not act as a director of any company, or directly or indirectly take part in or be concerned in the promotion, formation or management of a company;
(b) without the previous sanction of the bankruptcy trustee, be prohibited from creating any charge on his estate or taking any further debt;
(c) be required to inform his business partners that he is undergoing a bankruptcy process;
(d) prior to entering into any financial or commercial transaction of such value as may be prescribed, either individually or jointly, inform all the parties involved in such transaction that he is undergoing a bankruptcy process;
(e) without the previous sanction of the Adjudicating Authority, be incompetent to maintain any legal action or proceedings in relation to the bankruptcy debts; and
(f) not be permitted to travel overseas without the permission of the Adjudicating Authority.
(2) Any restriction to which a bankrupt may be subject under this section shall cease to have effect, if--
(a) the bankruptcy order against him is modified or recalled under section 142; or
(b) he is discharged under section 138.
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More sections of this act
Section 1 · Short title, extent and commencement.Section 2 · Application.Section 3 · Definitions.Section 4 · Application of this Part.Section 5 · Definitions.Section 6 · Persons who may initiate corporate insolvency resolution process.Section 7 · Initiation of corporate insolvency resolution process by financial creditor.Section 8 · Insolvency resolution by operational creditor.India Code, Government of India. Text fetched 09 Oct 2026. Source metadata reports last modification: 2024-07-25. Check the linked official text and subsequent notifications when applying a provision.