Section 150 Duties 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 estate vests in the trustee, but the information about it stays with the bankrupt. Section 150 closes that gap by requiring full disclosure, attendance at meetings and notification within seven days of any property acquired, devolved or income increased after bankruptcy commences.
What the section 150 duties require
- The bankrupt must give the trustee comprehensive details of financial affairs, including any information that may assist in understanding the financial situation.
- The bankrupt must attend meetings with the trustee at times the trustee specifies.
- The bankrupt must notify the trustee within seven days if, after the bankruptcy commencement date, there is an acquisition of property, a devolution of property, or an increase in income.
- The bankrupt must do anything else prescribed by law or required by the trustee to assist in managing the bankruptcy.
Even after a discharge order under section 138, the bankrupt must continue to perform these duties — with one exception. The obligation in clause (c) of sub-section (1) to notify acquisitions, devolutions and increases in income ends on discharge.
The distinction tracks the after-acquired property regime. Property acquired after the discharge order is beyond the trustee's reach under section 159, so there is nothing to report. Everything else — cooperation, information, attendance — is about the past estate, which the trustee is still administering.
Why seven days
The notification limb feeds directly into section 159. The trustee may claim after-acquired property for the estate by serving notice within fifteen days of the acquisition or devolution coming to the trustee's knowledge. The section 150 duties supply that knowledge, and a seven-day reporting obligation leaves the trustee a workable margin inside the fifteen.
Regulation 28(2) closes the obvious escape route. If the bankrupt disposes of property before giving the notice, the bankrupt must, within seven days of the disposal, disclose the details of the person to whom it was transferred and any other information needed to trace and recover the property for the estate. Under Regulation 28(3), the trustee's expenses in bringing back the amount or acquiring title form part of the bankruptcy process costs.
Regulation 12 — who else must cooperate
The section 150 duties bind the bankrupt. Regulation 12 requires all assistance and cooperation from a much wider group:
- the bankrupt;
- creditors of the bankrupt;
- employees and workmen of the bankrupt;
- partners of the bankrupt;
- auditors of the bankrupt;
- professionals appointed by the bankruptcy trustee under the regulations;
- the resolution professional or the previous bankruptcy trustee of the bankrupt;
- the interim resolution professional, resolution professional and liquidator in respect of the corporate debtor;
- any person in possession of property of the bankrupt; and
- any other person connected or relevant to the bankruptcy process.
The corporate debtor's office-holders are on the list
Including the IRP, resolution professional and liquidator of the corporate debtor is specific to the personal guarantor situation. The guarantor's exposure arises from the corporate debt, so the amount of the claim, what the security realised and what the resolution plan did with the guarantee are all facts held on the corporate side. Without the cooperation duty, the guarantor's trustee would be working from the guarantor's own account of a process the guarantor did not run.
Enforcement
The section 150 duties are backed by the Part III offences rather than by contempt:
- Failing to deliver possession of property under section 156 is an offence under section 186(d).
- Failing to provide, or destroying, altering or falsifying books of account is an offence under section 186(b).
- Knowingly giving false information or concealing material information is an offence under section 186(a).
- Failing to account for the loss of a substantial part of the estate in the 12 months before the application attracts a fine of three times the loss under section 186(e).
Common mistakes
- Assuming all obligations end at discharge — only the clause (c) notification does.
- Reporting an inheritance or a salary rise at the next meeting rather than within seven days.
- Disposing of after-acquired property and treating the Regulation 28(2) disclosure as optional.
- Overlooking auditors and the corporate debtor's office-holders when seeking records.