Module: General Practice
Q30: As of February 2026, what are the minimum default thresholds required to initiate the Corporate Insolvency Resolution Process (CIRP) and the Pre-Packaged Insolvency Resolution Process (PPIRP), respectively?
✅ Correct Answer: B
CIRP Threshold: Under Section 4 of the IBC, the Central Government raised the minimum default threshold for initiating CIRP to Rupees 1 Crore to prevent the overburdening of Tribunals with small cases.
PPIRP Threshold: The Pre-Packaged Insolvency Resolution Process (PPIRP), designed specifically for MSMEs, has a lower default threshold of Rupees 10 Lakhs.
Rationale: The lower limit for PPIRP ensures that smaller MSMEs can access the resolution framework, while the higher CIRP limit filters out trivial cases for larger corporates.
PPIRP Threshold: The Pre-Packaged Insolvency Resolution Process (PPIRP), designed specifically for MSMEs, has a lower default threshold of Rupees 10 Lakhs.
Rationale: The lower limit for PPIRP ensures that smaller MSMEs can access the resolution framework, while the higher CIRP limit filters out trivial cases for larger corporates.