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MMy dad’s business recently shut down, and he’s now left with no money to live. He has no assets and is deeply in debt. He’s borrowed from multiple relatives and even took a loan of ₹23 lakh from my cousin sister, claiming it was for a visa process related to studying abroad. But just two months after borrowing it, he used the money to cover business dues and invest in stocks.
The current debts are as follows:
• ₹10 lakh in unpaid business bills
• ₹2 lakh in credit card dues
• Several other business loans that I’m not fully sure ofmy dad gave up his share in the business for two years to an agreement with a partner, who will own his share until then, and they are paying the business related loans. But he still has alot of other loans which im not sure of
Now, he’s doing nothing and doesn’t seem to be making any effort to pay these debts. Banks are already calling, but my parents have stopped answering the calls.
I’m just a student with no job, and I don’t know what will happen if the banks and relatives keep pressuring him.
What happens if he doesn’t pay the loans?
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BLeave the house with your mother if you can. The constant pressure of answering the door to debt collectors will be traumatic, let your father deal with the mess he made.
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UTo declare bankruptcy in India, you can file an insolvency petition with the high court or district court. You can file if you are unable to pay your debts, which amount to at least Rs 500.
How to file:
1. Consult a legal advisor to help you determine the best course of action.
2. File an insolvency petition in Form 2 with the high court or district court.
3. The court will analyze your petition and decide whether to accept it.What happens after filing:
* If your petition is accepted, a Resolution Professional (RP) will examine it.
* The RP will recommend whether to accept or reject the petition.
* If the petition is accepted, a moratorium will be placed on debt collection for six months.
* The RP will issue a public notice calling for claims.Who can file:
* A debtor (insolvent person) can file an insolvency petition.
* A creditor can also file an application to trigger the insolvency resolution process.What are the different types of insolvency processes?
* **Bankruptcy route**: A debtor or creditor can file an application to initiate CIRP.
* **Fresh Start Process**: This process is for people with low income, assets, and debts.*Text generated using Gemini AI*
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UBro atleast google before posting
Sharing economic times article from 2022 regarding the same
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SDon’t burn yourself to keep others warm. Let him declare bankruptcy. Don’t go about funding his revival
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E“Several other business loans that I’m not fully sure of ”
You need to have a clearer picture. Like how much is the principal and how much is the interest. It could be accumulated amount over a few years. Next, find out all the parties – relatives or external. You already mentioned two. In short, make a list.
The tricky part is your relationship with your parents – if they are willing to disclose such information to you or not. And lastly, please don’t sign anything legal for taking over your parents’ loan. You can offer them your help in other ways. Good luck!
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