Mode of sale

(1) The liquidator shall ordinarily sell the assets of the corporate debtor through an auction in the manner specified in Schedule I. 71[Provided that the liquidator shall not sell the assets without prior permission of the Adjudicating Authority under this sub-regulation to: (a) a related party of the corporate debtor subject to proviso to clause (f) of sub-section (1) of Section 35; (b) his related party; or (c) any professional appointed by him.] (2) 72[ The liquidator may sell the assets of the corporate debtor by means of private sale only after prior approval of the committee with voting share of sixty six per cent., in the manner specified in Schedule I when – (a) the asset is perishable; (b) the asset is likely to deteriorate in value significantly if not sold immediately; or (c) the permission of the Adjudicating Authority has been obtained for such sale: Provided that the liquidator shall not sell the assets, by way of private sale to- (a) a related party of the corporate debtor; (b) his related party; or (c) any professional appointed by him.] 71 Inserted by Notification No. IBBI/2026-27/GN/REG151, dated 01st June, 2026 (w.e.f. 02-06-2026). 72 Substituted by Notification No. IBBI/2026-27/GN/REG151, dated 01st June, 2026 (w.e.f. 02-06-2026). Before substitution, the words stood as under:- “(2) The liquidator may sell the assets of the corporate debtor by means of 72[private sale only after prior consultation with the consultation committee under regulation 31A, in the manner specified in Schedule I when ]- (a) the asset is perishable; (b) the asset is likely to deteriorate in value significantly if not sold immediately;72[or] [***] (c) the prior permission of the Adjudicating Authority has been obtained for such sale: Provided that the liquidator shall not sell the assets, without prior permission of the Adjudicating Authority, by way of private sale to- (c) a related party of the corporate debtor; (d) his related party; or (e) any professional appointed by him.”.

(3) The liquidator shall not proceed with the sale of an asset if he has reason to believe that there is any collusion between the buyers, or the corporate debtor’s related parties and buyers, or the creditors and the buyer, and shall submit a report to the Adjudicating Authority in this regard, seeking appropriate orders against the colluding parties.