Sections 64A 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.
Three changes in the IBC (Amendment) Act, 2026 sit outside the headline reforms but determine how the amended Code will actually operate: substantially enhanced penalties for frivolous applications under section 64A, an electronic portal for insolvency management proposed under section 240B, and a cross-border insolvency framework introduced by section 240C, with rules to follow.
Section 64A — the necessary counterweight to mandatory admission
Penalty provisions for frivolous applications have been substantially enhanced.
Under the old section 7(5) the Adjudicating Authority had discretion to refuse admission, and that discretion did double duty — it also filtered out applications brought as leverage rather than to resolve genuine distress. The amendment removes it: admission is now mandatory once debt and default are established.
Remove the filter at the front and the deterrent has to move to the back. That is what enhanced section 64A penalties do. The two changes are a matched pair, and reading either one alone gives a misleading picture of the amended Code — mandatory admission is not an invitation to file.
For practitioners the advice that follows is concrete: a marginal application that would previously have been tested at admission now proceeds, and the applicant carries an enhanced penalty exposure if it should not have been brought. The pre-filing assessment has to be more rigorous than before, not less.
Section 240B — the electronic portal
An electronic portal for insolvency management is proposed under section 240B.
Its significance is disproportionate to the length of the provision, because the amendment's timelines depend on it. ICAI's assessment of the implementation risk names it explicitly: without bench strength, case management systems, court digitalisation and the proposed electronic portal under section 240B, the 14-day admission and 30-day order-passing mandates will remain aspirational rather than operational.
A 14-day admission timeline is not achievable through judicial effort alone on a paper-based filing system. The portal is the infrastructure that makes the statutory clocks realistic.
Section 240C — cross-border insolvency
A cross-border insolvency framework is introduced under section 240C, with rules to follow.
| Position | Status |
|---|---|
| Statutory framework | Introduced |
| Rules | To follow — not yet issued |
| Practical availability | Not yet operational |
This has been the Code's longest-standing gap. Indian insolvency proceedings have had no statutory mechanism for recognising foreign proceedings or coordinating with foreign courts, which has left assets abroad effectively out of reach and foreign creditors without a defined route in.
Section 240C creates the framework. Until the rules issue, the position to advise is that the enabling provision exists and the mechanism does not yet operate. ICAI lists the issuance of detailed group insolvency and cross-border insolvency rules among the factors that will determine whether the amendment achieves its objectives.
Two related procedural changes
- NCLAT is mandated to dispose of appeals within three months. Appellate delay has been as damaging as first-instance delay, because a plan under challenge cannot be implemented.
- Under section 10, the IRP is appointed by the Adjudicating Authority and shall not be recommended by the corporate applicant — the same institutional-appointment principle applied to the liquidator.
What the three provisions have in common
None of them is a substantive reform of insolvency law. All three are about whether the substantive reforms work:
- Section 64A keeps mandatory admission from becoming a tool of harassment.
- Section 240B is the infrastructure the statutory timelines depend on.
- Section 240C extends the Code's reach to assets and creditors it currently cannot touch.
ICAI's list of implementation challenges is largely a list about these: judicial infrastructure, calibration of notifications, and regulatory harmonisation between the IBC, the Companies Act, SEBI regulations and FEMA.
Compliance checklist
- Apply a stricter pre-filing assessment — mandatory admission does not reduce the risk of an unmeritorious filing, it increases the penalty for one.
- Advise applicants on enhanced section 64A exposure before filing.
- Do not advise a cross-border strategy as available under section 240C until the rules issue.
- Prepare for portal-based filing under section 240B as it rolls out.
- Diarise the three-month NCLAT disposal mandate in appeal strategy.
- In a section 10 filing, do not propose an IRP.
Common mistakes
- Reading mandatory admission as a lower bar for filing.
- Advising on cross-border recognition as though section 240C is operational.
- Assuming the 14-day timeline will hold before the portal and bench capacity are in place.
- Recommending an IRP in a corporate applicant filing.