The average time to conclude a resolution process under the Insolvency and Bankruptcy Code (IBC) is on a rise. According to official data, it took 603 days to complete 1,300 corporate insolvency resolution processes (CIRP) in the July-September 2025 quarter, which is higher than 582 days in the corresponding quarter last year.
This is way above the 330-day limit set to conclude the process. As per the latest report from the Insolvency and Bankruptcy Board of India (IBBI), the 2896 CIRPs, which ended up in orders for liquidation, took an average 518 days to complete, up from 505 days in the same quarter last year.
Even though the government has taken a series of steps to accelerate the process such as including the litigation time within the 330-day limit, introducing pre-packaged insolvency for MSMEs, and capacity building; the worsening of average resolution time results has resulted in significant erosion in the asset values of distressed companies.
What does the IBBI report suggest?
Despite the delays in the resolution process, the IBBI report shows that the resolution plans, on an average, yielded 93.8% of the fair value of the corporate debtors in the September 2025 quarter, which is higher than the 86.13% realised in the same quarter last year. Though realisations through liquidation remained slightly lower (90.7%) than realisation through resolution plans.
The data shows that nearly 60% of the insolvency cases were initiated by the financial creditors followed by operational creditors (33%) and corporate debtors (7%). This is largely in line with the trend of past five quarters. It was also observed that about 80% of CIRPs which had an underlying default of less than Rs 1 crore were initiated on applications by operational creditors while about 80% of CIRPs which had an underlying default of more than Rs 10 crore were initiated by financial creditors.
Meanwhile, the share of withdrawals and closures as a percentage of overall CIRPs has gone up marginally. For instance, total withdrawal and closure cases stood at 29.6% of the total CIRPs, up from 29.25% in the September 2024 quarter.
What do experts say?
Experts said a marginal increase in withdrawal and closure indicates the willingness of the defaulters to settle their dues to avoid the bankruptcy proceedings. To be sure, the promoters of insolvent companies can be allowed to withdraw from CIRP if they can secure the approval of 90% of the voting share of the committee of creditors (CoC).
As per IBBI, a total of 8,659 of corporate debtors were admitted as on September 2025 end, out of which 3865 were rescued (through resolution plans, appeal or review or settlement or withdrawal). The cumulative recovery through resolution plans stood at Rs. 3.99 lakh crore as on September 2025.
