Sections 114 and 115 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
The creditors vote and the resolution professional reports, but the repayment plan takes effect only when the Adjudicating Authority passes an order. Section 114 says what that order is based on and what else it may contain. Section 115 says what approval does and what follows rejection. This article reads both as printed in the IBBI consolidated text of the Code amended up to 12 August 2021. If a plan is before the Adjudicating Authority, early advice from a legal dispute resolution team helps a debtor or creditor prepare for either outcome.
The Adjudicating Authority approves or rejects the repayment plan by order, on the basis of the report of the meeting under section 112, or, if no meeting was summoned, on the resolution professional's report under section 106. An approving order may include directions for implementation, and if the Authority thinks the plan needs modification it may direct the professional to re-convene a meeting. Once approved, the plan takes effect as if proposed by the debtor in the meeting and is binding on the creditors mentioned in it and the debtor. If it is rejected, the debtor and the creditors may apply for bankruptcy under Chapter IV.
Section 114: the order
Sub-section (1): the basis of the decision
"The Adjudicating Authority shall by an order approve or reject the repayment plan on the basis of the report of the meeting of the creditors submitted by the resolution professional under section 112."
The proviso adds: "where a meeting of creditors is not summoned, the Adjudicating Authority shall pass an order on the basis of the report prepared by the resolution professional under section 106."
The two reports are explained in our articles on sections 111 to 113 and on section 106. The word "shall" means the Authority must pass an order, and it must either approve or reject. The section prints no period for the order. Note also that the Authority decides "on the basis of" the report, which is why the contents of the report matter.
Sub-section (2): directions for implementation
"The order of the Adjudicating Authority approving the repayment plan may also provide for directions for implementing the repayment plan." This is permissive. Implementation is later supervised by the resolution professional (section 116), as explained in our article on sections 116 and 117.
Sub-section (3): re-convening a meeting
"Where the Adjudicating Authority is of the opinion that the repayment plan requires modification, it may direct the resolution professional to re-convene a meeting of the creditors for reconsidering the repayment plan."
The Authority is not given a power to modify the plan itself. It can only send the matter back, by directing the professional to re-convene a meeting. The modification, if any, comes from the creditors and the debtor through the process in sections 108 and 111; see our article on sections 107 to 109.
Section 115: the effect of the order
Sub-section (1): approval
"Where the Adjudicating Authority has approved the repayment plan under section 114, such repayment plan shall":
| Clause | Effect |
|---|---|
| (a) | Take effect as if proposed by the debtor in the meeting |
| (b) | Be binding on creditors mentioned in the repayment plan and the debtor |
The words "as if proposed by the debtor in the meeting" place the plan in the position of the debtor's own proposal, as modified with his consent. The binding effect reaches "creditors mentioned in the repayment plan", so the plan binds those the plan names. A creditor who is not mentioned in the plan is outside the words of clause (b).
The binding effect also fixes the "period of the repayment plan" used in section 110, which runs from the order under section 114; see our article on section 110.
Sub-section (2): rejection
"Where the Adjudicating Authority rejects the repayment plan under section 114, the debtor and the creditors shall be entitled to file an application for bankruptcy under Chapter IV."
The entitlement is given to both the debtor and the creditors. Section 121(1)(b) picks it up by referring to an order under sub-section (2) of section 115, and section 121(2) sets the filing period at three months from the date of the order; see our article on sections 121 and 122.
Sub-section (3): the register
"A copy of the order passed by the Adjudicating Authority under sub-section (2) shall be provided to the Board, for the purpose of recording an entry in the register referred to in section 196."
Printing point: sub-section (3) refers to the order "passed ... under sub-section (2)", although sub-section (2) of section 115 states the consequence of a rejection under section 114 rather than a separate order. It is quoted as printed and read as a reference to the order of rejection. Only a copy of that order is expressly required to go to the Board here.
Example. The creditors of Manoj Bhargava approve his repayment plan by the required majority. The resolution professional's report of the meeting goes to the Adjudicating Authority, which approves the plan and directs that instalments be paid through a named account. Under section 115(1) the plan takes effect as if Manoj had proposed it in the meeting, and it binds him and every creditor mentioned in it. Had the Authority rejected the plan instead, Manoj and his creditors could each have applied for a bankruptcy order under Chapter IV.
Where the order sits in the sequence
The order follows the report of the meeting and begins the plan period. It is the starting point for implementation (section 116), completion (section 117) and, if the plan fails, the premature end in section 118; see our article on sections 118 and 120. A discharge order under section 119 may follow completion; see our article on the discharge order under section 119.
The Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Regulations, 2019 is the regulation set for this process for personal guarantors; the copy consulted is amended up to 02-06-2026. No rules or regulations on other individuals or on partnership firms are in the texts consulted.
The Amendment Act, 2026
The Insolvency and Bankruptcy Code (Amendment) Act, 2026 (No. 6 of 2026) does not amend sections 114 or 115 as printed in the texts consulted. It does amend sections 106 and 121, which lead to and from these sections. The Amendment Act, 2026 comes into force on the date or dates the Central Government notifies; the notification is not in the texts consulted, so check whether those changes have been notified.
Amendments and notifications made after 12 August 2021, other than the Amendment Act, 2026, are not in the texts consulted and should be checked.
Need help with an order on a repayment plan?
An order approving a plan binds the debtor and the creditors named in it, and an order rejecting it opens the three-month window for a bankruptcy application. Our legal dispute resolution team can read the order against sections 114 and 115 and advise on the next step for either side.
Key takeaways
- The Adjudicating Authority must approve or reject the plan by order, on the report of the meeting or, if no meeting was held, on the section 106 report.
- It may add directions for implementation, or direct the professional to re-convene a meeting.
- An approved plan takes effect as if proposed by the debtor in the meeting and binds the debtor and the creditors mentioned in it.
- A rejected plan entitles the debtor and creditors to apply for bankruptcy under Chapter IV.
- A copy of the order goes to the Board for the register.
Read next
- Sections 116 and 117: implementation, supervision and completion
- Sections 118 and 120: the repayment plan coming to an end prematurely
- Sections 111 to 113: approval of the repayment plan
- The discharge order under section 119
Disclaimer: Based on the IBBI consolidated text of the Insolvency and Bankruptcy Code, 2016 amended up to 12 August 2021 and on the Insolvency and Bankruptcy Code (Amendment) Act, 2026 (No. 6 of 2026), which comes into force on the date or dates notified by the Central Government, as consulted on 2 October 2026. It explains the words of the statute only; commencement notifications, other amendments made after 12 August 2021, notified thresholds, the rules and IBBI regulations, and the way tribunals and courts apply these sections should be checked. This article is general information, not legal advice; check the official text before acting.