15 May 2018

Bankruptcy

Finance feed by:

Mr Ananth Narayana

CA in Practice
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   •    12 Year 11 Month  experience

When an organisation is unable to honour its financial obligations or make payment to its creditors, it files for bankruptcy. A petition is filed in the court for the same where all the outstanding debts of the company are measured and paid out if not in full from the company’s assets.

In India if you file for bankruptcy it will not go down well with your credit rating, which means that it may be tough for you to get a new loan if you plan to start afresh. However, it would save you from any financial trouble.

Bankruptcy filing is a legal course undertaken by the company to free itself from debt obligations. Debts which are not paid to creditors in full are forgiven for the owners. Bankruptcy filing varies in different countries.

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