Fresh Start process for individuals and partnership firms

A street vendor near CSMT borrowed a little money for stock, fell ill, and now owes more than he will ever earn back. He is not a businessman with assets to fight over; he is simply stuck, and every creditor can still sue him. Should the law let someone at the very bottom wipe the slate and begin again? Chapter II of Part III of the Insolvency and Bankruptcy Code, the fresh start process, says yes, but only to a very narrow class of debtor and only for a narrow class of debt.

In two minutes

The fresh start process (ss.80–93 of the Code) lets a very poor individual debtor get a court-supervised discharge from his qualifying debts after a 180-day moratorium, without going through full bankruptcy.

The rest of this chapter

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