Reconstruction and Liquidation

Reconstruction is a legal process aimed at restructuring a financially distressed company to restore profitability and keep it operational, often involving renegotiating debts or changing management. Liquidation, on the other hand, involves selling off a company's assets to pay creditors, typically when the business cannot be saved. It results in the company's closure. Essentially, reconstruction seeks to revive and continue the business, while liquidation concludes its existence, distributing remaining assets to creditors.