The Insolvency and Bankruptcy Code, 2016
PART III Insolvency Resolution and Bankruptcy for Individuals and Partnership Firms
CHAPTER IV Bankruptcy Order for Individuals and Partnership Firms
Section 141: Restrictions on bankrupt:
*141. (1) A bankrupt, from the bankruptcy commencement date, shall—
(a) not act as a director of any company, or directly or indirectly take part in or be concerned in the promotion, formation or management of a company;
(b) without the previous sanction of the bankruptcy trustee, be prohibited from creating any charge on his estate or taking any further debt;
(c) be required to inform his business partners that he is undergoing a bankruptcy process;
(d) prior to entering into any financial or commercial transaction of such value as may be prescribed, either individually or jointly, inform all the parties involved in such transaction that he is undergoing a bankruptcy process;
(e) without the previous sanction of the Adjudicating Authority, be incompetent to maintain any legal action or proceedings in relation to the bankruptcy debts; and
(f) not be permitted to travel overseas without the permission of the Adjudicating Authority.
(2) Any restriction to which a bankrupt may be subject under this section shall cease to have effect, if—
(a) the bankruptcy order against him is modified or recalled under section 142; or
(b) he is discharged under section 138.
Notifications & Circulars
*Only in so far as they relate to personal guarantors to corporate debtors, shall come into force w.e.f. 01.12.2019.