Specimen Affidavit of Creditor explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Creditor's Affidavit in Liquidation
When a company goes into liquidation (voluntary or compulsory winding up, or liquidation under IBC): creditors must file an affidavit proving their debt with the liquidator to receive distribution from the company's assets. The affidavit establishes: (a) the existence of the debt, (b) the amount due, (c) the basis of the claim, (d) any security held, (e) supporting documents. Only PROVED debts are admitted for distribution.
Specimen Affidavit
AFFIDAVIT OF PROOF OF DEBT
In the matter of (In Liquidation)
Before the Liquidator / NCLT Bench
I, , , of , , do hereby solemnly affirm and state on oath:
1. I am the and am competent to swear this affidavit.
2. (In Liquidation) (the "Company") is INDEBTED to me/my company in the sum of Rs. as on the date of winding up order/liquidation commencement ().
3. The debt arises from: dated / loan advanced on vide agreement dated / services rendered during / rent for premises at for the period ].
4. Particulars of the debt:
| Description | Invoice/Ref. | Date | Amount (Rs.) |
|---|---|---|---|
| -- | |||
| Total |
5. Security: , pledge of , personal guarantee of . The estimated value of the security is Rs. . I claim as a creditor.]
6. I have NOT received any payment or satisfaction for the said debt, except .
7. The supporting documents are attached as Exhibits: (a) Exhibit A -- Invoices, (b) Exhibit B -- Delivery challans/proof of service, (c) Exhibit C -- Ledger account extract, (d) Exhibit D -- Agreement/contract, (e) Exhibit E -- Correspondence/demand letters.
8. The contents of this affidavit are true and correct to my personal knowledge.
DEPONENT
| | Date:
Solemnly affirmed before me on at .
IBC Claims Process
Under the Insolvency and Bankruptcy Code, 2016: during CIRP (Corporate Insolvency Resolution Process): (a) the Resolution Professional (RP) invites claims from creditors (public announcement under Section 15), (b) creditors file claims in the PRESCRIBED FORM (Form B for operational creditors, Form C for financial creditors, Form D for workmen/employees), (c) the RP verifies and admits/rejects claims, (d) admitted claims are included in the Committee of Creditors (for financial creditors) or claims list (for operational creditors). During LIQUIDATION: claims are filed with the Liquidator in the prescribed form -- similar to the affidavit format above.
Priority of Claims in Liquidation
Under Section 53 IBC (waterfall): (1) CIRP costs and liquidation costs, (2) SECURED creditors (with relinquished security), (3) WORKMEN dues (24 months) and secured creditors (not relinquished), (4) EMPLOYEE dues (12 months), (5) UNSECURED creditors, (6) Government dues (2 years), (7) Remaining debts, (8) PREFERENCE shareholders, (9) EQUITY shareholders.
Disclaimer: This article is for informational purposes only and does not constitute legal or professional advice. While every effort has been made to ensure accuracy based on the latest laws and amendments, readers should consult a qualified professional before acting on any information provided. For expert assistance, contact us.
Key Facts About Specimen Affidavit of Creditor
- Applies in: All states across India, under the relevant central law.
- Mode: Mostly online via the official government portal.
- Typical timeline: Ranges from a few days to a few weeks depending on the case.
- Non-compliance: May attract penalties, interest or late fees.
- Expert help: TaxClue completes the entire process end to end for you.
What must the creditor's affidavit contain?
The affidavit must contain: (1) CREDITOR's identity -- name, address, capacity (individual/company representative), (2) AMOUNT of debt -- exact figure as on the relevant date, (3) BASIS of debt -- nature (goods supplied, loan, services, rent) with specific references (invoice numbers, agreement dates), (4) PARTICULARS -- itemized breakdown of the claim, (5) SECURITY -- whether the creditor holds any security (mortgage, pledge, guarantee) and its estimated value, (6) PAYMENTS received -- any partial payments already received, (7) SUPPORTING DOCUMENTS -- invoices, agreements, delivery proof, ledger accounts, (8) VERIFICATION -- sworn before a Notary/Oath Commissioner.
What is the difference between secured and unsecured creditor claims?
SECURED creditor: holds SECURITY (mortgage, charge, pledge) over the company's assets -- their claim is satisfied from the specific secured assets FIRST (Section 52 IBC). If the security value exceeds the debt: the secured creditor is fully paid. If insufficient: the shortfall is an unsecured claim. UNSECURED creditor: holds NO security -- their claim is satisfied from the remaining assets AFTER secured creditors, workmen, and employees (Section 53 waterfall). Recovery rate: secured creditors typically recover 60-80%; unsecured creditors may recover 10-30% or less depending on available assets.
Over 90% of compliance penalties in India arise from missed due dates — timely handling can save businesses thousands of rupees each year.
Specimen Affidavit of Creditor: a key compliance topic in Indian tax and corporate law that businesses and individuals must understand to remain compliant.
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