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If your employer has filed for bankruptcy, it means that the business is no longer able to pay off its debts to its creditors, and the company has asked the court to help it either plan a repayment schedule (?Chapter 11? bankruptcy) or sell off all its property and use the money to pay off the creditors (?Chapter 7? ...

In a business Chapter 7 bankruptcy, the business is closed, all assets are liquidated by the bankruptcy trustee, and the proceeds from the business assets are paid out to the business's creditors.

Insolvency of a Private Limited Company by Court or Tribunal The order is to be served even upon those who've filed the petition for liquidation. The liquidator, appointed by the central government, shall examine the books of the company, the cash in hand, bank balance, liabilities, creditors, loans, etc.

This chapter of the Bankruptcy Code generally provides for reorganization, usually involving a corporation or partnership. A chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time. People in business or individuals can also seek relief in chapter 11.

Involuntary bankruptcy is a legal process by which creditors can ?force? an individual or business to enter into bankruptcy. The creditor must petition the courts to initiate the bankruptcy proceedings and the indebted party can file an objection to force a case.

Definition: When an organisation is unable to honour its financial obligations or make payment to its creditors, it files for bankruptcy. A petition is filed in the court for the same where all the outstanding debts of the company are measured and paid out if not in full from the company's assets.