Insolvency and Bankruptcy Code, 2016 | Corporate liquidation

Section 39 of IBC 2016: Verification of Claims by the Liquidator

Section 39 requires the liquidator to verify creditors' claims submitted under Section 38 and empowers the liquidator to request additional documents or evidence needed to verify a claim in whole or in part.

Section 39 - Statutory provisions

39(1). The liquidator shall verify the claims submitted under section 38 within such time as specified by the Board.

39(2). The liquidator may require any creditor or the corporate debtor or any other person to produce any other document or evidence which he thinks necessary for the purpose of verifying the whole or any part of the claim.

Meaning and scope of Section 39

Verification of claims is the liquidator's examination of the existence, supporting proof and amount of debts asserted against the corporate debtor. The process helps establish which claims may be admitted for valuation and eventual distribution in liquidation. Verification does not, by itself, guarantee admission or payment.

Section 39(1): Duty to verify claims

Claims submitted or collected under Section 38 (consolidation of claims) must be verified within the period prescribed by the Insolvency and Bankruptcy Board of India (IBBI). Regulation 30 of the IBBI (Liquidation Process) Regulations, 2016 governs verification and admission or rejection of claims; readers should consult the current consolidated text for any applicable amendments and special provisions.

Section 39(2): Power to seek evidence

The liquidator can seek further documentation from the claimant, the corporate debtor or another person where necessary. Depending on the nature of the claim, relevant material may include loan agreements, account statements, invoices, contracts, court orders, information-utility records and proof of security interests.

Important distinction: Section 39 concerns verification. The separate decision to admit or reject a claim is addressed in Section 40, and an aggrieved creditor may have a statutory appeal under Section 42.

How claims are verified in liquidation

Receipt of claim: The claim is submitted or collected in accordance with Section 38 and applicable liquidation regulations.
Examination: The liquidator checks the evidence, underlying obligation, amount and relevant records.
Additional proof: If required, the liquidator seeks documents or clarification under Section 39(2).
Decision: Following verification, the claim may be admitted or rejected wholly or partly under Section 40, with reasons recorded in writing for rejection.
Communication and remedy: Section 40 requires communication of the decision; Section 42 provides for appeal to the Adjudicating Authority within 14 days of receipt of the decision.

Relevant legal terms and provisions

Liquidator: The insolvency professional acting in the corporate liquidation process under Section 34.
Claim: Defined in Section 3(6), broadly including a right to payment or a right to a remedy for breach of contract giving rise to payment, whether disputed or undisputed and subject to statutory qualifications.
Creditor: Defined in Section 3(10), including financial creditors, operational creditors and other persons to whom a debt is owed.
Section 38: Consolidation and submission of claims.
Section 40: Admission or rejection of claims after verification.
Section 41: Determination of valuation of admitted claims.
Section 42: Appeal against the liquidator's decision on claims.
Section 53: Statutory priority for distribution of liquidation proceeds.

Official legal sources

Legal information updated: 21 October 2026. This article is general information and should be read with the currently applicable statutory text, regulations and judicial decisions.