Introduction
The IBBI has recently notified an amendment to the IBBI (Liquidation Process) Regulations, 2016 via Notification No. IBBI/2025-26/GN/REG134 dated 2nd January, 2026. The amendment revises Regulation 47B, which governs the filing of forms during the liquidation process. The revised forms have been structured to reduce the compliance burden on insolvency professionals by eliminating duplicative disclosures, rationalising data requirements, and leveraging technological features such as auto-population of information already available on the portal. As a result, the revisions are expected to substantially reduce the time and effort required for regulatory compliance while ensuring that the Board continues to receive all essential information in a timely and effective manner.
The revised forms, with the exception of Form LIQ-2, are scheduled to be made available on the IBBI website from 1 January 2026, with the existing forms standing discontinued from that date. Form LIQ-2, being required to be filed only on or after 1 February 2026, will be made available in accordance with the applicable filing timeline.
In addition, the Board has introduced a transitional facilitation period to enable insolvency professionals to familiarise themselves with the revised reporting framework and to address any initial technical or operational challenges. During the first quarter of implementation, spanning January to March 2026, no penalty is proposed to be levied for any delays in filing the revised forms.
Key Amendments To Liquidation Regulation
The amended regulations introduce a structured, stage-wise reporting mechanism through four revised forms, LIQ-1 to LIQ-4, each corresponding to a distinct phase of the liquidation process, thereby enabling continuous regulatory oversight.
Form LIQ-1 (Initial Disclosure Stage):
It sets out information from the commencement of liquidation, including key details of the corporate debtor and the public announcement. It is required to be filed on or before the tenth day of the month following the month in which the public announcement is made.
Form LIQ-2 (Quarterly Progress Reporting):
It serves as a quarterly progress report on the liquidation process and includes information relating to the status of the process, valuation, realisation, preferential and other avoidance transactions (PUFE), meetings of the Stakeholders’ Consultation Committee, and statements of receipts and payments. The form is to be filed on or before the tenth day of the month following the submission of the progress report to the Adjudicating Authority.
Form LIQ-3 (Pre-Dissolution / Closure Reporting):
It covers the period from the last filed progress report until the filing of the application for dissolution or closure of the liquidation process. It includes details on the dissolution or closure application, unclaimed proceeds, the realisation and distribution of proceeds, and receipts and payments. Information furnished in the preceding progress report is auto-carried forward, thereby avoiding repetitive disclosures. The form is to be filed on or before the tenth day of the month following the submission of the dissolution or closure application to the Adjudicating Authority.
Form LIQ-4 (Final Closure Reporting):
It applies to the final stage of liquidation, covering the period from the filing of the application for dissolution or closure until the passing of the corresponding order by the Adjudicating Authority. It records details of the final distribution of proceeds and the closing statements of receipts and payments. Notably, the amended framework shortens the filing timeline, requiring the form to be submitted within seven days of the Adjudicating Authority’s disposal of the application, as opposed to the earlier fourteen-day period.
Conclusion
The amendment to Regulation 47B of the IBBI (Liquidation Process) Regulations, 2016 marks a significant step towards rationalising and modernising the compliance architecture governing liquidation proceedings. By introducing a stage-wise, technology-enabled reporting framework through revised Forms LIQ-1 to LIQ-4, the IBBI has sought to balance regulatory oversight with procedural efficiency.
The reduction of duplicative reporting, reliance on auto-populated data, and reduction of filing timelines, particularly at the final closure stage, reflect a clear policy intent to reduce compliance friction without diluting transparency or accountability. Viewed holistically, the revised framework strengthens data-driven supervision of liquidation processes while easing the operational burden on insolvency professionals, thereby contributing to a more efficient and predictable insolvency regime.
Expositor(s): Adv. Shreya Mishra, Riya Raksha (Intern)
