Section 39: Verification of Claims

Section 39 of the Insolvency and Bankruptcy Code, 2016 governs verification of claims submitted in a corporate liquidation. It requires the liquidator to verify claims submitted under Section 38 within the time specified by the Insolvency and Bankruptcy Board of India and permits the liquidator to call for further documents or evidence when required.

Section 39 - Statutory provision

What Section 39 means

Verification is the stage at which the liquidator examines a claim and the supporting material to determine its basis and amount before taking the decision contemplated by Section 40. The provision is therefore part of the statutory sequence for dealing with creditor claims during liquidation.

Claims submitted under Section 38

Section 38 governs receipt and collection of claims and provides for claims by financial creditors, operational creditors and creditors whose claims contain both financial and operational debt. Section 39(1) expressly requires the liquidator to verify claims submitted under that provision within the period specified by the Board.

Power to require documents and evidence

Section 39(2) gives the liquidator power to require a creditor, the corporate debtor or any other person to produce additional documents or evidence considered necessary for verification of the whole or any part of a claim. This enables the liquidator to examine the supporting basis of a claim rather than relying only on the initial material submitted by a claimant.

Verification and admission or rejection

Verification under Section 39 is followed by the process under Section 40. Section 40 empowers the liquidator, after verification, to admit or reject a claim in whole or in part, subject to the requirements of that provision. The verification exercise under Section 39 should therefore be distinguished from the subsequent statutory decision on admission or rejection.

Role of the Insolvency and Bankruptcy Board of India

The "Board" referred to in Section 39 is the Insolvency and Bankruptcy Board of India established under the Code. The detailed procedural framework for corporate liquidation, including matters concerning claims and their verification, is contained in the IBBI (Liquidation Process) Regulations, 2016, as amended from time to time.

Official legal resources

For the current statutory and regulatory position, refer to the IBBI Acts page, the IBBI updated liquidation regulations, and the IBBI circulars page.