An NRI creditor of an insolvent Indian company -- whether a financial creditor, an operational creditor such as an unpaid supplier, or an employee owed dues -- must generally submit a claim to the resolution professional using the prescribed IBBI claim form (Form C for operational creditors, Form F for other creditors, among others) within the timeline set out in the public announcement made after CIRP is admitted, typically within 90 days of the insolvency commencement date though this can vary. This can generally be done remotely, by email or through the resolution professional's designated channel, and does not require the NRI creditor to travel to India, though supporting documents (invoices, contracts, correspondence, or loan documents) must be provided. This platform recommends NRI creditors monitor the Insolvency and Bankruptcy Board of India's public announcements and the corporate debtor's own disclosures actively, since a missed claim deadline can seriously prejudice recovery.
How and when to submit a claim
Once CIRP is admitted, the resolution professional is required to make a public announcement inviting
claims from all categories of creditors -- financial creditors, operational creditors, workmen and
employees, and others -- specifying the last date for submission, commonly cited as within 90 days of the
insolvency commencement date, though timelines can be extended or vary by case. Claims are submitted on
prescribed forms specified under IBBI regulations (broadly, Form C for operational creditors, Form D for
workmen and employees, Form F for other creditors, among the various prescribed forms), accompanied by
supporting documentation establishing the debt -- invoices, purchase orders, contracts, correspondence
evidencing the debt, loan agreements, or bank statements, as relevant to the nature of the claim. This
platform recommends an NRI creditor identify and organise this supporting documentation as early as
possible once aware of a potential insolvency situation, since gathering historical records from abroad
under time pressure is considerably harder than assembling them calmly in advance.
Submitting a claim remotely, and the role of a Power of Attorney
Claim submission generally does not require the creditor to be physically present in India -- claims
are typically submitted electronically or by post to the resolution professional at the address and
contact details specified in the public announcement, and an NRI creditor can generally engage an Indian
lawyer or insolvency professional to prepare and submit the claim on their behalf. Where ongoing
representation is expected -- attending Committee of Creditors meetings (for a financial creditor with
voting rights), responding to queries from the resolution professional, or participating in related NCLT
proceedings -- this platform recommends executing a properly notarised and, where applicable,
apostilled or consular-attested Power of Attorney authorising a representative in India to act on the
NRI creditor's behalf, prepared well in advance of when it is actually needed given how document
execution and attestation can take time from abroad.
What happens after a claim is admitted, and repatriating any recovery
Once the resolution professional verifies and admits a claim, the amount is reflected in the
information memorandum and factored into any resolution plan under negotiation, or, if the company moves
to liquidation, into the Section 53 waterfall distribution. Where an NRI creditor's claim results in an
actual recovery -- whether through an approved resolution plan or liquidation proceeds -- this platform
recommends confirming with the paying entity and the receiving bank how the amount should be credited
(commonly into an NRE or NRO account depending on the original source of the underlying debt) and what
FEMA documentation, such as Form 15CA/15CB, may apply for onward remittance abroad, broadly similar to the
considerations that apply to insurance payouts and motor accident compensation. This platform also
recommends NRI creditors keep realistic expectations about timing and amount -- both CIRP and liquidation
can extend well beyond their statutory timelines in practice, and recovery, particularly for unsecured
claims, is often only partial.
Common mistakes people make when filing claims as an NRI creditor:
- Missing the claim submission deadline specified in the resolution professional's public
announcement, which can seriously prejudice the ability to recover.
- Not preparing supporting documentation (invoices, contracts, loan records) proactively, making it
harder to substantiate the claim under time pressure.
- Waiting until a Power of Attorney is urgently needed rather than preparing and properly attesting
it well in advance.
