The purpose of this study is to examine how artificial intelligence (AI) can be integrated into India’s insolvency and bankruptcy resolution framework, particularly under the Insolvency and Bankruptcy Code (IBC) 2016, and to assess the readiness of India’s regulatory, institutional and constitutional environment for such integration.
The research adopts a doctrinal and comparative legal methodology, combining analysis of statutory texts (IBC 2016, DPDP Act 2023, Bharatiya Sakshya Adhiniyam 2023), case law and institutional reports from the Insolvency and Bankruptcy Board of India (IBBI) with comparative references to the European Union, the UK and Singapore. It also uses secondary data analysis of IBBI quarterly outcomes to illustrate recovery trends and procedural bottlenecks. Figures and tables are included to support the empirical insights.
The study finds that while AI has significant potential to improve resolution timelines, claim verification and case management within insolvency processes, India’s legal and regulatory frameworks do not yet define its role. Key challenges include due process concerns under Articles 14 and 21 of the Constitution, evidentiary admissibility under the Bharatiya Sakshya Adhiniyam, liability allocation for errors and compliance with the Digital Personal Data Protection Act 2023. Comparative analysis reveals that jurisdictions adopting AI in justice systems rely on strong safeguards of explainability, oversight and accountability.
To the best of the authors’ knowledge, this paper is one of the first comprehensive analyses of AI integration in India’s insolvency ecosystem, combining doctrinal legal review, empirical data on insolvency outcomes and international comparisons. It proposes a phased policy roadmap for India, including regulatory sandboxes, statutory amendments and institutional capacity-building, while balancing digital sovereignty and open internet principles.
