Partial modification to IBBI’s 2023 circular on liquidators’ fees

Introduction: The Insolvency and Bankruptcy Board of India (IBBI) recently issued a circular, making partial modifications to a previous circular dated September 28, 2023, regarding liquidators’ fees under IBBI (Liquidation Process) Regulations, 2016.

Insolvency and Bankruptcy Board of India
7th Floor, Mayur Bhawan, Connaught Place, New Delhi-110001

Circular No. IBBI/LIQ/70/2024 Dated: 18^th April, 2024

To
All Registered Insolvency Professionals
All Recognised Insolvency Professional Entities
All Registered Insolvency Professional Agencies
(By mail to registered email addresses and on the website of the IBBI)

Dear Madam/Sir,

Sub: Partial modification to the circular no. IBBI/LIQ/61/2023 dated 28th September 2023 titled ‘Clarification w.r.t. Liquidators’ fee under clause (b) of sub-regulation (2) of Regulation 4 of  IBBI (Liquidation Process) Regulations, 2016′.

1. The Insolvency and Bankruptcy Board of India (IBBI) issued a circular dated 28^th September 2023 titled ‘Clarification w.r.t. Liquidators’ fee under clause (b) of sub-regulation (2) of Regulation 4 of IBBI (Liquidation Process) Regulations, 2016’ (‘the circular’).

1.1 Further, vide order dated 04^th April 2024, of the Hon’ble Bombay High Court in the matter of Amit Gupta vs. Insolvency and Bankruptcy Board of India & Union of India (Writ Petition (Lodging) No. 34701 of 2023), while confirming the validity of remaining paras of the circular, Paragraph 2.1 (‘Amount Realised’) and Paragraph 2.5 (‘Period for calculation of fee’) have been struck down.

1.2 Accordingly, vide this circular, para 2.1 and para 2.5 of the said circular of 28^th September 2023 are being withdrawn.

1.3 The IPs who have not submitted any compliance in relation to circular dated 28^th September,2023, are hereby given an opportunity to comply with the remaining parts of the circular dated 28^th September 2023 and inform the status of the same to the IBBI electronically on the website of IBBI on or before 31^st May 2024.

2. This is issued in exercise of the powers conferred under section 196 of the Insolvency and Bankruptcy Code, 2016.

Yours faithfully,
-Sd-
(Rajesh Tiwari)
General Manager