This chapter can be availed by corporations, partnerships and individual business owners and envisages both voluntary and involuntary filing of petitions. The main aim of these provisions is to provide corporations with an opportunity to salvage their business by a process of re-organization. The proceeding under Chapter 11 is also initiated with the filing of a petition by the debtor at the concerned Court where he resides or is domiciled or its principle place of business.
The debtor in this case is termed as a debtor in possession, since he has possession of his assets during the period of reorganization. He will cease to be the same when a trustee is appointed or when his reorganization plan is confirmed or when his case is dismissed. Unlike Chapter 9, the role of US Trustee is of much significance under this chapter. He is in charge of the overall supervision of the operation of business by debtor in possession. He also has the duty to convene creditors meetings and question the activities of the debtor. Confirmation of the reorganization plan submitted by the debtor entails the discharge of the debtor’s liabilities subject to certain exceptions. Furthermore, the Chapter provides for modification of the plan after the confirmation, if the amended plan is in confirmation with the Bankruptcy and is subject to judicial verification. The closure with respect to such cases is obtained when the estate is “fully administered
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