In the case a debtor is unable to pay his debt and also fulfills the condition specified in the sub-section, a creditor or a debtor will be entitled to make an application for fresh start. The fresh start process is as per Section 80 of IBC.

For small individuals, an application will be filed in the DRT for initiation of Fresh Start Process. Following the application, an interim-moratorium will begin on the date of filing in respect to all the debts. The IRP will be appointed and will begin the investigation. After investigation, the resolution professional will investigate and prepare a final list of all qualifying debts within 180 days from the date of application.

On the expiry of this period, the Adjudicating Authority will pass an order on discharging of the debtor from the qualifying debts and accord an opportunity to the debtor to start afresh, financially.