Introduction
In order to amend and affiliate the existing laws which deals with Insolvency and Bankruptcy, the Indian parliament enacts an act named Insolvency and Bankruptcy code in year 2016 and thus established a board called Insolvency and Bankruptcy Board of India (IBBI) on 1st October, 2016 which acts as a very essential authority and acts as an regulator which regulates the process as well as supervise over the Insolvency Professionals( IP) , Insolvency Professional Agencies, and Information Utilities (IU). IBBI is tasked with enforcing the IBC and amending laws to resolve insolvency for corporate people , partnerships firms, and individuals without delay which aims to maximize the value of their assets. It made and enforce the rules for processes such as corporate insolvency resolution(CIRP) , liquidation, individual insolvency resolution and individual bankruptcy under the Code. IBBI acts the major pillar when it comes to give effect to IBC. The main function of the board includes registering insolvency professionals and agencies involved in bankruptcy, regulating the insolvency process, and improving the overall system in India. The IBBI also promote credit availability, entrepreneurship, and the balance of all shareholders’ interests.
IBBI Governing Board
IBBI consists of ten members who are appointed by Central Government, including representatives from the Ministries of Finance, Law and corporate affairs, and the Reserve Bank of India. one chairman, three members from Central Government not below the rank of Joint Secretary , One member is nominated by RBI (Reserve Bank of India), and five members are nominated by Central Government out of which three should function as full time members.
Basically chairperson and other members have the integrity and ability to deal with the issues of insolvency and Bankruptcy for which they must expertise and experience in some fields like law, finance, accountancy and economics. The term of chairperson and members of the board is five years Or until attain the age of sixty-five whichever is earlier. It is to be noted that they are qualified for re-appointment.
Impact of IBBI
1.Effective implementation of the code (IBC, 2016)by regulating IPs and IUs which plays a crucial part in insolvency resolution process. The establishment of the board lead to reduced burden on courts and enhanced creditor’s trust in recovery process expeditiously.
2.Promoting efficiency for timely resolution of insolvency cases . Also the board is authorised to make amendments in existing laws to improve the process and strengthen the IBC framework by making the process more transparent and overcome the challenges and loopholes in the legislation.
For example; IBBI bring amendment to smooth the appointment of insolvency professionals by presenting a panel of eligible contender by Adjudicating Authority which helped in accelerating the appointment process.
General functions and powers of the board -Section 196 of IBC, 2016
1. It maintains a registry of the registered IPs, and can set a eligibility standards for registration of the Insolvency professionals , agencies and the Information Utilities (IU).
2. It can also review, cancel, suspend and withdraw the abovementioned authorities .
3. Encourage development and supervise the working of IP, IU and Insolvency Agencies.
4. Impose fees and other charges carried out for the purpose of the code.
5. It specifies standard regulation needed for proper functioning of insolvency professionals, insolvency agencies and information utilities.
6. Laid down the minimum syllabus for examination (for enrollment in Insolvency Agencies) of IP.
7. The board can give direction to IP, IU ,Insolvency Agencies comply with code while carrying out the inspection and monitor and review the their performance.
8. Call for information and maintain records relating to Insolvency and Bankruptcy cases along with specifying the manner of storing such data by IU.
9. Issuing guidelines and regulation for time bound disposal of assets of corporate debtor.
10. Maintain websites for digital information and constitute committees.
11. Specify redressal mechanism of grievances against insolvency professionals.
12. Perform any other function as prescribed by the central government.
Power of IBBI
To make model bye-laws to be adopted by Insolvency professional agencies to provide:
1. Minimum standards for professional competence and ethical conduct.
2. Enrolment requirements for person as members of insolvency professional agency should be fair and non-discriminatory.
3. Establishing a governing board for internal management of insolvency professional agency as per regulation specified by the board.
4. specifying information to be submitted by members along with form and prescribed time of such submission.
5. Specify the classes of people to whom the services is provided at concessional rates or for free.
6. IBBI has power to impose fines and penalties to whosoever violates the regulations provided by the board or any provision of the code.
7. It also have power to initiate legal proceeding against the violators either it be individual Or entity.
8. grounds for expelling insolvency professionals from membership.
9. The manner of utilising the amount received as penalty on insolvency professional.
10. The manner of monitoring and reviewing the performance of members and other activities to be performed by members.=
Note- The Board may exercise the same powers vested in a civil court under the Civil Procedure Code, 1908 (CPC) while exercising the powers under the IBC, at the time of trying a suit, in respect of the following matters:
a. Discovery of documents and books of accounts, at such time as specified by board.
b. Summon and enforce the attendance of person and their examination on oath.
c. The board have power to inspect any document of any person at any place.
d. Examination of witness /document by issuance of commission.
Conclusion:
In order to conclude , the Insolvency and Bankruptcy Board of India (IBBI) is a unique regulatory body to oversee and regulate insolvency proceedings in the country by keeping a check on authorities namely Insolvency professional, Insolvency professional agency, information utilities and ensuring that they are doing their work in accordance with the Insolvency and Bankruptcy code, 2016 . IBBI also supports the Indian economic structure and aims to ease of business by development of speedy procedures to streamline the Insolvency and Bankruptcy process in India with an improved legal framework which can benefit creditors as well as debtors due to the fairness and transparency carried out by the board which will develop greater trust and confidence among this system and also help to promote credit culture in a healthy way .
In a nutshell the role of IBBI is to ensure that the laws relating to insolvency and bankruptcy under the code is being implementing in fair manner and smooth operation of insolvency and bankruptcy process in India . Moreover, the board promotes the public awareness of insolvency and bankruptcy laws which facilitate a timely and well mannered resolution of the cases related to insolvency and bankruptcy in India.
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