Business Bankruptcy is a common incident in today’s economy. An insolvent organization that finds it tough to pay its debts, temporarily, or on a permanent basis, initially attempts for informal workouts by controlling internal resources or improving performance measures and negotiating with the creditors. Both the firm and the creditors have an active interest to avoid a formal bankruptcy. From the debtor’s point of view, a business bankruptcy will close the business and take their status off. Also, the creditors may get more than the debt if the business is declared bankrupt. Likewise, creditors fear that in bankruptcy, they will end up getting back fewer amounts than the amount of debts outstanding. So there is an effort from both the sides to avoid a business bankruptcy. Different methodologies can be adopted to sidle line the phenomenon of business bankruptcy. Pre pack administration is one among them in which the assets of the company is sold to a third party or the existing directors to save the company.