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eVoting for Committee of Creditors under IBC

Under the Insolvency and Bankruptcy Code (IBC), 2016 Insolvency Resolution Professional (IRP) is required to provide eVoting option to creditors. A Committee of Creditors (CoC) is formed where all the creditors of the debtor company are members and their voting weightage is determined on the basis of the amount outstanding. Each member of the creditor’s committee has the right to vote on all important matters. The Insolvency Resolution Professional (IRP) / Resolutions Professional (RP) / Interim Resolution Professional (IRP) / Liquidator is expected to take opinion of all the members in form of vote on all important matters.

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Is eVoting mandatory under IBC?

Yes, providing remote voting option in electronic form is mandatory under Insolvency and Bankruptcy Code (IBC), 2016. Although IBC explicitly does not insist on using eVoting platforms, however, it stipulates that all member of committee of creditors should be provided option to vote during the meeting and also after the meeting. It also provides that members of CoC should have the option to vote remotely. Few IRPs have interpreted it to mean that they can take the vote on email or WhatsApp. However, that is not the best practice and is avoidable. Using a proper government of India approved eVoting platform like Right2Vote not only ensures proper documentation and compliance with the process but also helps when result is to be filed with National Company Law Tribunal (NCLT).

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Features recommended for Committee of Creditors Voting

Audit Trail

With AUDIT TRAIL feature, the system records IP address and time of voting of each and every voter. This helps in maintaining an audit trail and is useful in case of any dispute.

Voter Recipt

Each voter is sent a VOTER RECEIPT on his email. The receipt mentions the choice selected by the voter. This is very helpful feature for creditors or bankers who need the record of their eVoting for internal filing.

Allow vote change

ALLOW VOTE CHANGE feature allows the voter to change his vote any time before the close of voting. This feature is an additional feature for the member of creditor’s committee to use in case they receive instructions from their seniors / bank management to change the vote preference.

Weighted votes

WEIGHTED VOTES is a very useful feature for eVoting under IBC for committee of creditors. Unlike normal voting where each voter has one vote, in committee of creditor’s voting, the vote share is determined on the basis of outstanding amount of each creditor. With this feature, the result is automatically calculated after taking into account the respective vote share of each creditor. This saves lot of time and effort for the insolvency professional.

OTP based authentication

OTP BASED AUTHENTICATION feature ensures that only the authorised voter is able to vote. In case of committee of creditors there are multiple bank representatives who are involved in the process. Several members from the same bank might attend the meeting. However, OTP based authentication ensures that only the authorised voter is able to vote and nobody else is able to access or vote.

Time extension

TIME EXTENSION feature is very useful in case of creditors’ voting under IBC. For various reason including delay in approval from bank management or court instructions at times the voting duration has to be extended. Right2Vote offers free time extension feature where insolvency professional can extent the time of the poll multiple times free of charge.

Reminders

REMINDERS features allow the insolvency professional to send automated reminders to member of CoC who have not yet exercised their right to vote. The reminder only goes to voters who have not voted yet. Insolvency professional can send up to three reminders free of cost in Right2Vote online voting platform.

Detailed results in PDF and excel format

Right2Vote provide the result of the eVoting in both PDF and excel format. The PDF format gives the synopsis of the result with Right2Vote watermark. The PDF format is useful for circulation among creditors and for submission to court / NCLT. Right2Vote also provides result in excel format where audit trail details like IP address and time of voting is also available. This is to be used for audit purpose. As eVoting under IBC does not require SECRET BALLOT feature, the details excel result also provides individual voter vote preference.

Benefits of using Right2Vote eVoting platform for CoC voting

Tested, certified and approved by Government of India

Right2Vote’s eVoting software is tested and certified by Standardization, Testing and Quality Certification (STQC) Directorate under Ministry of Electronics and Information Technology (MeitY), Government of India. Right2Vote is also an approved eVoting agency of Ministry of Corporate Affairs (MCA), Government of India.

As eVoting results need to be presented in the court / NCLT, it is always better to use a government of India certified platform.

Right2Vote’s 247365 DIY platform & responsive support team

Right2Vote’s eVoting platform is very easy to use and intuitive DO IT YOURSELF (DIY) platform. Insolvency professionals and their team can set up polls in the platform at any time of the day and setting up the poll does not take more than 15 minutes. Right2Vote support team is also very responsive and set up polls for the clients on short notice. Many a times during emergency, clients ask Right2Vote’s team to set up poll on 5-minute notice and Right2Vote team executes it without any delay. No other eVoting platform in India or abroad can match the responsiveness of Right2Vote’s support team.

Cost Effective

Right2Vote is the most cost-effective platform for eVoting under IBC. Right2Vote charges only Rs. 5000 + GST for Committee of Creditor’s eVoting for up to 200 creditors. Right2Vote also does not charge extra for long duration or for time extension in case of CoC eVoting.

Time and effort saving

Conducting Committee of Creditor’s eVoting using Right2Vote’s online voting technology saves lot of time and effort for the insolvency professionals. From setting up the poll, to sending invite, sending reminders, creditor authentication, vote recording, calculating results – everything is done by the system automatically saving lot of time and effort for IRPs. This enables busy IRPs to focus their energies and resources on other important and urgent matters.

Convenience for creditors leading to better participation

Creditors are busy people and it is not possible for them to attend all meeting of CoC or physically visit the IRP office for voting on all matters. Online voting enables committee members to vote anytime from anywhere. This not only saves time and effort of the creditors but also lead to better participation and higher voter turnout in voting.

Security and transparency

Right2Vote’s eVoting platform is not only secured with encryption, OTP based authentication and other features but is also very transparent with features like audit trail, voter receipt and vote record.

Feature rich

Right2Vote provides many other optional features like Team election, voter selfie, double authentication, biometric authentication and multiple votes - limited. Based on specific required of the poll, insolvency professionals can use these additional features. Unlike most other platform Right2Vote offers flexibility to use advanced features in critical and more sensitive polls like selection of Insolvency professional or approval of resolution plan.

Trusted by leading insolvency firms

eLeading insolvency firms and insolvency professional including AAA Insolvency, Sumedha Management, PwC, KPMG, Deloitte, Alvarez and Mashal are using eVoting, Video Conference, Virtual Data Room and eAuction services of Right2Vote for insolvency matters.

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FAQS

Frequently Asked Questions

How does IBC eVoting work during the Corporate Insolvency Resolution Process (CIRP)?

IBC eVoting enables creditors to securely cast their votes online on resolutions placed before the Committee of Creditors. Each creditor receives authenticated voting credentials, reviews the agenda, casts their vote within the specified timeline, and the system automatically calculates voting percentages based on admitted claims.

What voting percentage is required to approve a resolution plan under the IBC?

Most key decisions under the Insolvency and Bankruptcy Code, including approval of a resolution plan, require approval by not less than 66% of the voting share of financial creditors in the Committee of Creditors, unless otherwise provided under the Code or regulations.

Who can vote in a Committee of Creditors (CoC) meeting?

Generally, financial creditors who are members of the Committee of Creditors are entitled to vote. Operational creditors may attend meetings when permitted under the law but typically do not have voting rights unless specifically provided by the IBC.

Do secured creditors have voting rights under the IBC?

Yes. Secured financial creditors who are members of the Committee of Creditors have voting rights based on their admitted financial claims. Their voting share is proportional to the value of their admitted debt.

Can operational creditors vote in IBC proceedings?

Operational creditors generally do not have voting rights in Committee of Creditors meetings. However, they may participate in meetings if their aggregate dues meet the prescribed threshold or if invited under applicable regulations.

Can related party financial creditors vote in the Committee of Creditors?

In many cases, related party financial creditors are excluded from the Committee of Creditors to ensure independent decision-making. The applicability depends on the facts of the case and the provisions of the Insolvency and Bankruptcy Code.

How does Right2Vote support insolvency professionals in conducting CoC voting?

Right2Vote provides a secure eVoting platform that enables Resolution Professionals, Liquidators, and Insolvency Professionals to conduct legally compliant electronic voting, generate audit trails, calculate weighted voting percentages automatically, and maintain complete voting records.

Can Committee of Creditors voting be conducted completely online?

Yes. The Insolvency and Bankruptcy Board of India (IBBI) regulations permit electronic voting. Secure online voting platforms help Resolution Professionals conduct CoC voting efficiently while maintaining transparency, confidentiality, and complete audit logs.

What happens if a creditor does not vote in a CoC meeting?

If a creditor chooses not to vote within the prescribed voting period, the voting outcome is determined based on the votes actually cast according to the applicable voting share requirements under the Insolvency and Bankruptcy Code.

Can Resolution Professionals conduct multiple CoC votes on the same platform?

Yes. Modern eVoting platforms like Right2Vote allow Resolution Professionals to conduct multiple voting events for different agendas, maintain separate records, manage multiple insolvency cases simultaneously, and generate case-wise reports.