The Information Memorandum (IM) serves as the cornerstone of the Corporate Insolvency Resolution Process (CIRP) under India’s Insolvency and Bankruptcy Code (IBC), 2016. It is a comprehensive document prepared by the Resolution Professional (RP) to enable potential investors to assess the corporate debtor’s financial, operational, and legal status. This report examines the IM’s regulatory framework, mandatory contents, recent amendments, and practical challenges, supported by judicial precedents and regulatory updates.

The IM is mandated under Section 29 of the IBC, which requires the RP to compile “relevant information” for resolution applicants. This includes financial data, asset details, litigation history, and material disputes[1][6]. The Insolvency and Bankruptcy Board of India (IBBI) further elaborates on the IM’s structure through Regulation 36 of the CIRP Regulations, 2016, specifying 12 essential components[2][5][8].
### Key Objectives
- Transparency: Ensures resolution applicants have access to critical data for informed bidding.
- Value Maximization: By disclosing asset quality and liabilities, the IM fosters competitive bidding.
- Legal Compliance: Mitigates risks of post-resolution disputes by documenting the corporate debtor’s status at the insolvency commencement date[6][9].

- Assets and Liabilities: Detailed descriptions, including acquisition dates, costs, remaining useful life, and geographical coordinates of fixed assets[2][5]. Contingent liabilities must also be disclosed[5][8].
- Financial Statements: Audited statements for the previous two years, provisional statements for the current year, and annual reports[2][6].
- Carry-Forward Losses: A 2025 IBBI amendment mandates disclosure of tax losses under the Income Tax Act, 1961, enhancing transparency for resolution applicants[3][4].

- Creditor List: Names, claimed amounts, admitted claims, and security interests[2][8].
- Related-Party Transactions: Debts due to/from related parties and guarantees provided[5][9].
- Material Litigation: Ongoing investigations, government proceedings, and significant disputes[6][8].

- Employees and Workers: Headcount and liabilities, including unpaid wages[2][8].
- Statutory Dues: Outstanding GST, TDS, PF, and ESI payments[9].

The IBBI’s Circular No. IBBI/CIRP/83/2025 requires RPs to explicitly detail tax losses in the IM. This amendment addresses historical underreporting and enables resolution applicants to leverage tax benefits, improving resolution plan viability[3][4].

The eBKray platform, managed by PSB Alliance, mandates listing assets with photographs, videos, and coordinates. This reduces information asymmetry and expands bidder participation[2][5].

- Non-Cooperative Management: Suspended directors often withhold critical data, as seen in the Savute Textiles case, where the RP relied on audited statements from 2019–2022 due to incomplete disclosures[9].
- Contingent Liabilities: Identifying off-balance-sheet obligations (e.g., pending lawsuits) requires rigorous due diligence[6][8].

The IM must be submitted to the Committee of Creditors (CoC) by the 95th day of CIRP. Delays risk derailing resolution timelines, as highlighted in Amtek Auto, where incomplete asset disclosure led to litigation[6][9].

The RP faced challenges in procuring post-2019 financial data, underscoring the importance of regulatory safeguards to compel management cooperation. The IM included disclaimers about incomplete information, illustrating practical limitations[9].

The NCLT emphasized the IM’s role in ensuring transparency, ruling that suppression of material facts invalidates resolution plans. This precedent reinforces the RP’s duty to verify data rigorously[6].

The Information Memorandum is pivotal to the IBC’s success, balancing creditor recovery with investor confidence. Recent amendments, such as mandatory tax loss disclosures, reflect regulators’ commitment to enhancing transparency. However, challenges like data asymmetry and management non-cooperation necessitate stronger enforcement mechanisms. As India’s distressed asset market evolves, the IM will remain central to transforming liabilities into viable opportunities, driving economic revitalization.