What is Committee of Creditors (CoC)?
The Committee of Creditors (CoC) is the body of all financial creditors of a corporate debtor under CIRP, with voting rights in proportion to their claims. The CoC takes key decisions — appointing the RP, evaluating resolution plans and recommending liquidation if needed.
| Meaning | The Committee of Creditors (CoC) is the body of all financial creditors of a corporate debtor under CIRP, with voting rights in proportion to their claims. The CoC takes key decisions — appointing the RP, evaluating resolution plans and recommending liquidation if needed. |
|---|---|
| Category | Legal & Insolvency |
| Related Laws | IBC 2016, Sections 21–24 |
| Who Uses It | Financial creditors, RP |
| Why It Matters | CoC vote determines whether a resolution plan succeeds. |
Committee of Creditors (CoC) explained in plain English
A practitioner's view written for borrowers and advisors — not a textbook definition.
The Committee of Creditors (CoC) is the body of all financial creditors of a corporate debtor under CIRP, with voting rights in proportion to their claims. The CoC takes key decisions — appointing the RP, evaluating resolution plans and recommending liquidation if needed.
In practice, Committee of Creditors (CoC) is used most often by financial creditors, rp. Each of them sees the term from a slightly different angle: borrowers care about protection and outcomes, lenders care about classification and recovery, regulators care about consistency and disclosure.
The legal anchor for Committee of Creditors (CoC) is IBC 2016, Sections 21–24. RBI master directions, the SARFAESI Act 2002, the RDB Act 1993 and the IBC 2016 commonly interplay, depending on the loan size, security and stage of stress.
Why does it matter? CoC vote determines whether a resolution plan succeeds. For a stressed borrower, getting this concept right early often saves several months of penal interest, legal cost and credit-score damage.
A real example: CoC approves a resolution plan with 78% voting share. The mechanics may look complex, but the underlying logic — the bank wants closure, the borrower wants a fair outcome — is straightforward once the right framework is in place.
If you are facing a situation involving Committee of Creditors (CoC), the safest first step is a structured case review with a senior ex-banker who has handled comparable matters across banks and ARCs in India.
Where you'll encounter Committee of Creditors (CoC)
Whenever a loan moves from "Standard" to "stressed", Committee of Creditors (CoC) is one of the words that starts appearing in notices, bank emails and lawyers' opinions.
Sanctioning committees, recovery teams and risk officers use Committee of Creditors (CoC) to classify accounts, decide provisioning and approve resolution paths.
Committee of Creditors (CoC) appears in pleadings, securitisation applications, OAs, Section 7/9 petitions and SARFAESI writs as part of the dispute record.
When stressed loans are sold to ARCs or special-situations investors, Committee of Creditors (CoC) is used in term sheets, assignment agreements and due-diligence reports.