Statutory Meaning & Definition
An offence under Section 66(2) of IBC where an officer of the corporate debtor, knowing that there was no reasonable prospect of avoiding insolvency, continued to incur debts. The NCLT can make such persons personally liable.
Frequently Asked Questions (FAQs)
What is Wrongful Trading in Indian corporate law?
An offence under Section 66(2) of IBC where an officer of the corporate debtor, knowing that there was no reasonable prospect of avoiding insolvency, continued to incur debts. The NCLT can make such persons personally liable.
Why is Wrongful Trading important for compliance?
Wrongful Trading is governed by the Insolvency and Bankruptcy Code, 2016 and regulated by IBBI. Understanding this concept is essential for ensuring regulatory compliance, avoiding penalties, and making informed corporate decisions in India.
Who should know about Wrongful Trading?
Wrongful Trading is relevant for company secretaries, compliance officers, chartered accountants, corporate lawyers, board members, and all professionals dealing with IBC regulatory matters in India.
Contextual Analysis & Regulatory Circulars
Recent analysis and regulatory updates related to IBC:
Subhash Chandra Personal Insolvency: ₹22,006 Crore Claims, ₹6.5 Crore Repayment Plan and the Related-Party Voting Question — Explained
Published: 3 November 2026
IBBI CIRP Circulars 109 and 110 of 2026: New Form CA for Homebuyers and RERA Disclosure Rules for Real Estate Insolvency
Published: 31 October 2026
IBBI CIRP Fifth Amendment Regulations 2026: Real Estate Projects Can Be Excluded from Insolvency — Home Delivery First
Published: 31 October 2026
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