INSOLVENCY AND BANKRUPTCY BOARD OF INDIA

IN THE MATTER OF APPLICATION OF FOR GRANT OF CERTIFICATE OF REGISTRATION AS AN INSOLVENCY PROFESSIONAL UNDER REGULATION 7 OF THE INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (INSOLVENCY PROFESSIONALS) REGULATIONS, 2016

ORDER

UNDER REGULATION 8(3)(b) OF THE INSOLVENCY AND BANKRUPTCY BOARD OF INDIA (INSOLVENCY PROFESSIONALS) REGULATIONS, 2016

1. (the applicant), , submitted an application under regulation 6 of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 (Regulations), through the Insolvency Professional Agency of Institute of Cost Accountants of India (IPA), seeking certificate of registration as an Insolvency Professional (IP). The IPA forwarded the application to the Insolvency and Bankruptcy Board of India (Board) on 18th December, 2018 with a recommendation for registration of the applicant as IP.

2. While considering the aforesaid application for registration, the Board observed that the applicant has claimed a total experience of 19 plus years as under:

Sl. No. From To Employment with Experience
1 01.09.1997 30.09.2000 Vishesh Overseas 3 Years and 1 Month
2 22.03.2002 30.09.2018 NHPC Limited 16 Years and 6 Months
Total 19 Years and 7 Months

3. As per regulation 5 (c) (iii) of the Regulations, an individual is eligible for registration as an IP, if he has fifteen years of experience in management, after receiving a bachelor’s degree from a university established or recognised by law. After seeking and considering the details of employment of the applicant, the Board felt that the employment from 22nd March, 2002 to 31st March, 2008 (6 years), out of total experience of 19+ years, is not experience in management and, therefore, the balance experience of 13+years falls short of the requirement of 15 years. Hence, the Board formed a prima facie opinion that registration ought not to be granted to the applicant as he is not having requisite experience in managerial capacity, to be registered as an IP. The Board communicated, vide an e-mail dated 13th February 2019, its prima facie opinion and provided an opportunity to the applicant to explain as to why his application should be accepted.

4. The applicant responded vide mail dated 28th February, 2019. He stated that he was in junior management (supervisory grade) from 22nd March, 2002 to 31st March, 2008 (6 years), and he has, therefore, more than 15 years’ experience in management. He further stated that he left the service with Vishesh Overseas in September, 2000 to join the NHPC in March, 2002, indicating that he was not in employment from 1st October, 2000 to 21st March, 2002. He availed of an opportunity of personal hearing before me on 13th March, 2019 and reiterated what he had stated in his mail dated 28th February, 2019. He sought permission and time to substantiate his claim that he had experience in management in employment from 22nd March, 2002 to 31st March, 2008, which was granted.

5. Instead of submitting the requisite documents in support of experience in management while in employment from 22nd March, 2002 to 31st March, 2008, the applicant, vide his e-mail dated 20th March 2019, forwarded to the Board, a copy of his letter dated 19th March, 2019 to the Board and a copy of his letter dated 18th March, 2019 addressed to the IPA. These letters claimed that the applicant had experience in management in employment with Vishesh Overseas Inc. from 1st October, 2000 to 20th March, 2002 and he inadvertently missed to state this fact in the application for registration.

6. It appeared unusual that the applicant inadvertently missed to state his experience in the application when eligibility for registration is dependent on the experience. It also appeared perplexing that he made repeated submissions that he left Vishesh Overseas in September, 2000 to join the NHPC in March, 2002, while he claims, vide mail dated 20thMarch, 2019, that he was in employment with Vishsesh Overseas Inc. from 1st October, 2000 to 20th March, 2002. Interestingly, the applicant left Vishesh Overseas to join Vishesh Overseas Inc./The testimonial indicating that the applicant worked with Vishesh Overseas Inc. did not even carry the date of its issue. Further, the experience details that satisfy eligibility norms need to be provided in the application for registration and the IPA is required to be satisfied of the same before recommending an application for registration. Accordingly, further details of his employment with Vishesh Overseas Inc. was sought through his IPA vide mail dated 19th April, 2019.

7. The IPA, vide its letter dated 6th May, 2019, stated that the applicant “does not fulfil the eligibility criteria for enrolment as Insolvency Professional as his work experience as reflected and substantiated by the relevant documents does not in aggregate meet the stipulation of years of work experience criteria laid down in the Regulation 5 (iii) (c) of IBBI (IP) Regulations, 2016.”

8. In view of the submission of the IPA that the applicant is not eligible for registration as an IP, nothing survives for determination. Therefore, I, in exercise of powers under regulation 8(3)(b) of the Regulations, reject the application of , for registration as an Insolvency Professional.

9. The efforts and resources spent on processing this application could have been avoided if the IPA was diligent in its statutory duties. Further, but for diligence of the IBBI, the applicant, who is not eligible to be registered as an IP, would have been registered. The Insolvency Professional Agency of Institute of Cost Accountants of India, which recommended registration of an ineligible individual as an Insolvency Professional, needs to review its process of scrutiny of applications to avoid recurrence.

Date: 14th May, 2019
Place: New Delhi

(Dr. M. S. Sahoo)
Chairperson
Insolvency and Bankruptcy Board of India

Download order of  Insolvency And Bankruptcy Board of India

More Under Corporate Law

Leave a Comment

Your email address will not be published. Required fields are marked *

Search Posts by Date

October 2020
M T W T F S S
 1234
567891011
12131415161718
19202122232425
262728293031