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Introduction: The Insolvency and Bankruptcy Board of India (IBBI) has recently released the “Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) (Second) Guidelines, 2023” on December 08, 2023. These guidelines aim to streamline the process of recommending and appointing qualified professionals for various roles under the Insolvency and Bankruptcy Code, 2016.

Detailed Analysis:

1. Purpose and Need: The guidelines address the need to establish a panel of Insolvency Professionals (IPs) in advance to prevent administrative delays in their appointment. This panel will be shared with the Adjudicating Authority to facilitate the swift and efficient selection of IPs for diverse insolvency-related processes.

2. Short Title and Commencement: The guidelines, effective from January 1, 2024, to June 30, 2024, provide a structured framework for the selection and appointment of IPs. They emphasize the importance of ensuring that IPs meet specific eligibility criteria, including a valid Authorization for Assignment (AFA).

3. Eligibility Criteria: The guidelines outline stringent eligibility criteria for IPs, including a lack of pending disciplinary proceedings, no convictions in the last three years, and a valid AFA. IPs are required to submit an expression of interest along with consent to act in various capacities.

4. Expression of Interest: IPs are invited to submit expressions of interest by December 25, 2023. The Board will compile and share the Panel with the Adjudicating Authority by December 29, 2023. IPs must specify the sectors in which they have handled or are handling assignments under the Code.

5. Panel of IPs: The Board will prepare a common Panel of IPs categorized by zones. The Adjudicating Authority can select IPs from this panel for various processes related to corporate and individual debtors. The panel’s validity is for six months.

6. Scoring Criteria: The guidelines introduce scoring criteria based on the experience of IPs in handling liquidation and corporate insolvency resolution processes. In cases where IPs have the same score, the order of registration with the Board will determine their placement on the panel.

7. Conditions for IPs: IPs included in the panel are deemed to accept appointments as IRPs, Liquidators, RPs, or BTs. They cannot withdraw consent without sufficient justification, and any deviation may result in removal from the panel for six months. IPs are expected to maintain their registration during the panel’s validity.

8. Repeal and Savings: The guidelines repeal the earlier guidelines issued on June 12, 2023. All actions taken under the previous guidelines are saved.

Conclusion: The IBBI’s latest guidelines play a crucial role in enhancing the efficiency of the insolvency resolution process by proactively preparing a panel of qualified professionals. These guidelines prioritize experience, uphold stringent eligibility criteria, and ensure a transparent and systematic approach to the appointment of IPs. By streamlining the selection process, the IBBI aims to foster a robust insolvency ecosystem in line with the Insolvency and Bankruptcy Code, 2016.

Insolvency and Bankruptcy Board of India
(New Delhi)

The Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) (Second) Guidelines, 2023 issued on December 08, 2023.

December 08, 2023

Introduction

The Insolvency and Bankruptcy Board of India (“the Board”) is required to recommend the name of an Insolvency Professional (IP) on receiving reference from the National Company Law Tribunal and Debt Recovery Tribunal (Adjudicating Authority), in respect of the Corporate Insolvency or Individual Insolvency, as the case may be, for appointment as an Interim Resolution Professional (IRP), Resolution Professional (RP), Liquidator and Bankruptcy Trustee (BT) under Sections 16(4), 34(6), 97(4), 98(3), 125(4), 146(3), 147(3) of the Insolvency and Bankruptcy Code, 2016 (“Code”). Further, Rule 8(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Insolvency Resolution Process for Personal Guarantors to Corporate Debtors) Rules, 2019 and Rule 8(2) of the Insolvency and Bankruptcy (Application to Adjudicating Authority for Bankruptcy Process for Personal Guarantors to Corporate Debtors) Rules, 2019 enables the Board to share a Panel of IPs, who may be appointed as resolution professionals or bankruptcy trustee, with the Adjudicating Authority.

2. The need was felt to prepare the panel of IPs in advance and share with the Adjudicating Authority (AA) to avoid administrative delays in appointment of the IP. These guidelines provide the procedure for preparing panel of Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees.

1. Short title and commencement. (1) These guidelines may be called the Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) (Second) Guidelines, 2023.

(2) The panel of IPs prepared as per these guidelines will be effective from 1st January 2024 to 30th June 2024.

2. Eligibility of IPs. An IP is eligible to be included in the panel, if ―

(a) there is no disciplinary proceeding, whether initiated by the Board or the IPA, pending against IP;

(b) IP has not been convicted at any time in the last three years by a court of competent jurisdiction;

(c) IP has submitted expression of interest along with consent to act as Interim Resolution Professional, Resolution Professional, Liquidator and Bankruptcy Trustee, on appointed by the National Company Law Tribunal and Debt Recovery Tribunal;

(d) IP holds an Authorisation for Assignment (AFA), which is valid till the validity of Panel.
For example, the IP included in the Panel for appointments during January 01 – June 30, 2024, should have AFA valid up to June 30, 2024.

3. Expression of Interest. (1) The Board shall invite expression of interest from IPs in Form A by sending an e-mail to their email addresses registered with the Board. The expression of interest must be received by the Board in Form A by the specified date.

(2) The submission of expression of interest is an unconditional consent by the IP to act as an IRP, Liquidator, RP or BT of any process relating to a corporate or individual debtor, as the case may be.

(3) The IPs can submit their expression of interest by December 25, 2023. The Board will send the Panel to the AA by December 29, 2023.

(4) IPs are also required to fill the Sectors in which they have handled assignments or are handling assignments under the Code. The name of the Sectors is to be chosen from the drop-down list mentioned in the Form. If the IP selects the option ‘Others’, he must mention the name of the sector.

4. Panel of IPs. (1) The Board will prepare a common Panel of IPs for appointment as IRP, Liquidator, RP and BT and share the same with the AA (Hon’ble NCLT and Hon’ble DRT) in accordance with these Guidelines. The Panel will have validity of six months.

(2) The Panel will have a Zone wise list of IPs based on the registered office (address as registered with the Board) of the IP. List of Zones is given in Annexure-1.

(3) The AA may pick up any name from the Panel for appointment of IRP, Liquidator, RP or BT, for a CIRP, Liquidation Process, Insolvency Resolution process or Bankruptcy Process relating to a corporate debtor and personal guarantor to corporate debtor, as the case may be.

5. Scoring criteria. (1) In order to achieve the objectives of the Code it is imperative to give due consideration to the experience gained by IP in handling assignments of liquidation and corporate insolvency resolution process under the Code. Accordingly, the eligible IPs will be included in the Panel in the order of the volume of completed assignments in the order of experience.

(2) Where two or more IPs get the same score, they will be placed in the Panel in the order of date of their registration with the Board. The IP registered earlier will be placed above the IP registered later.

6. Conditions for IPs. (1) The inclusion of the name of the IP in the panel will be deemed acceptance to act as IRPs, Liquidator, RP or BT, as the case may be, on being appointed by the National Company Law Tribunal or the Debt Recovery Tribunal, as the case may be.

(2) The IPs will not withdraw their consent or refuse to accept the appointment unless otherwise permitted by the National Company Law Tribunal or Debt Recovery Tribunal or the Insolvency and Bankruptcy Board of India, in accordance with the law. Any refusal to act as IRP, Liquidator, RP or BT, as the case may be, on being appointed by the AA, without sufficient justification, will be treated as deviation from consent and name will be removed from panel for six months.

(3) It is desired that the IP will not surrender his registration to the Board or membership or Authorization for Assignment during the validity period of the panel.

(4) The AA may appoint the IP from the Panel to act as IRP, Liquidator, RP or BT, at their own discretion.

(5) The AA may refer to or direct the Board for the appointment of IP including the recommendation of IP, from or outside the Panel and in such cases, the Board may accordingly take suitable action for the appointment of IP, from or outside the panel.

7. Repeal and Savings. (1) The Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) Guidelines, 2023 issued on June 12, 2023, is hereby repealed as on the date of coming into effect of these guidelines and all actions taken under the repealed guidelines is saved.

****

Form A
EXPRESSION OF INTEREST TO ACT AS
AN IRP, LIQUIDATOR, RP AND BT IN ANY PROCESS RELATING
TO ANY CORPORATE OR INDIVIDUAL DEBTOR

1

Name of Insolvency Professional
2 Registration Number
3 No. and Date of Issue / Renewal of AFA, Date of Expiry of AFA, Name of IPA which has issued the AFA
4 Address and contact details, as registered with the Board:

a. E-mail

b. Mobile

c. Address

5 *Number of Processes as on date: Ongoing Completed
No. of processes Value of Resolution Plan (approved by CoC) (In Rs.) No. of Processes Approved Resolution Plan Value (CIRP)/ Realised Value of assets ( Liq/Vol Liq.) (In Rs.)
a. As IRP of CIR Process
b. As RP of CIR Process
c. As IRP of Fast Track Process
d. As RP of Fast Track Process
e. As Liquidator of

Liquidation/Voluntary
Liquidation Process

f. As RP of Individual Insolvency Resolution Process
g. As Bankruptcy Trustee
6 Name(s) of the Sector in which the IP has or is handling assignments (To be selected from the drop-down list)
7 Whether IP has been convicted at any time in the last three years by a court of competent jurisdiction? (Give details)
8 Whether IP is serving a suspension or debarment from serving as an IP? (Give details)  

 

9 Whether any disciplinary proceeding, whether initiated by the Board or the IPA, pending against the IP? (Give details)

*CIR Process shall include Pre-packaged Insolvency Resolution Process

Declaration

I hereby: –

a. confirm and declare that the information given herein above is true and correct to the best of my knowledge and belief, and express my interest to act as IRP, Liquidator, RP and BT, as the case may be, if appointed by the Adjudicating Authority.

b. undertake that if my name is included in the Panel, I shall abide by the Insolvency Professionals to act as Interim Resolution Professionals, Liquidators, Resolution Professionals and Bankruptcy Trustees (Recommendation) (Second) Guidelines, 2023.

Signature of Insolvency Professional

Place:
Date:

Annexure-1

An IP will be included in the Panel against the Zone where his registered office (his address as registered with the Board) is located. For example, an IP located in the city of Surat (Gujarat) will be included in Ahmedabad Zone, which covers the State of Gujarat. He shall be eligible for appointment by any bench of NCLT or DRT located in the State of Gujarat, Union Territory of Dadra and Nagar Haveli, and Union Territory of Daman and Diu. The areas covered in different Zones are as under:

Zones Areas Covered (The IPs having registered office in these areas shall be eligible for appointment by benches of NCLT and DRT located in these areas)
New Delhi 1

1

Union Territory of Delhi

State of Gujarat

Ahmedabad 2

3

1

Union Territory of Dadra and Nagar Haveli

Union Territory of Daman and Diu

State of Uttar Pradesh

Allahabad 2 State of Uttarakhand
Amravati 1 State of Andhra Pradesh
Bengaluru 1

1

State of Karnataka

State of Himachal Pradesh

Chandigarh 2

3

4

5

6

1

State of Punjab

State of Haryana

Union Territory of Chandigarh

Union Territory of Jammu and Kashmir

Union Territory of Ladakh

State of Chhattisgarh.

Cuttack 2

1

State of Odisha

State of Tamil Nadu

Chennai 2

1

2

3

4

Union Territory of Puducherry

State of Arunachal Pradesh

State of Assam

State of Manipur

State of Mizoram

Guwahati 5

6

7

8

State of Meghalaya

State of Nagaland

State of Sikkim

State of Tripura

Hyderabad 1 State of Telangana
Indore 1 State of Madhya Pradesh
Jaipur 1

1

State of Rajasthan

State of Kerala

Kochi

 

2

1

2

Union Territory of Lakshadweep

State of Bihar

State of Jharkhand

Kolkata 3

4

1

State of West Bengal

Union Territory of Andaman and Nicobar Islands

State of Goa

Mumbai 2 State of Maharashtra

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