New Delhi: Demand to increase transparency in insolvency process, IBBI The rules for corporate insolvency proceedings have been amended to require a resolution professional to provide details regarding his opinion regarding avoidance transactions relating to the corporate debtor.
Insolvency and Bankruptcy Board of India (IBBI) has amended the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Individuals) Regulations.
An official release on Wednesday said the amendments to the rules are aimed at “increasing discipline, transparency and accountability in corporate insolvency proceedings”.
A resolution professional is duty bound to ascertain whether a corporate debtor (CD) is subject to avoidance transactions, that is, preferential transactions, low-value transactions, extortionate credit transactions, fraudulent trading and wrongful trading, and applications with the adjudicating authority. taking admission. proper relief.
This not only recovers the lost value in such transactions, thereby increasing the possibility of restructuring the CD through resolution planning, but also discourages transactions that do not put pressure on the CD.
“For effective monitoring, modification is needed rp To file Form CIRP 8 on the Board’s electronic platform, informing the details of their opinion and determination with regard to the avoidance transaction,” the release said.
IBBI has prepared Form CIRP 8 and it is required to be filed in respect of every CIRP running or commenced on or after 14th July.
With the amended rules, an insolvency professional conducting the CIRP will have to disclose all former names and registered office address(s) that have been changed in the two years prior to the commencement of the insolvency, as well as the present name of the CD. And also the address of the registered office. All its communications and records.
CIRP refers to Corporate Insolvency Resolution Process.
The amendment takes into account the possibility where a CD may have changed its name or registered office address before the commencement of the insolvency process. In such cases, stakeholders may find it difficult to relate to the new name or registered office address and as a result they fail to participate in the CIRP.
Under the Insolvency Rules, an interim resolution professional or a resolution professional may appoint any professional, including registered valuers, to assist in the discharge of their duties in the conduct of the CIRP.
“The amendment provides that the IRP/RP may appoint a professional other than the registered valuer, if it is of the opinion that the services of such professional are required and such services are not available with the CD.
“Such appointments will be made on arm’s length basis following an objective and transparent process. The challan for the fee will be raised in the name of the professional and paid in his/her bank account,” the release said.
The amendments have come into effect from July 14.
IBBI is a key body in the enforcement of the Insolvency and Bankruptcy Code (IBC)
Insolvency and Bankruptcy Board of India (IBBI) has amended the Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Individuals) Regulations.
An official release on Wednesday said the amendments to the rules are aimed at “increasing discipline, transparency and accountability in corporate insolvency proceedings”.
A resolution professional is duty bound to ascertain whether a corporate debtor (CD) is subject to avoidance transactions, that is, preferential transactions, low-value transactions, extortionate credit transactions, fraudulent trading and wrongful trading, and applications with the adjudicating authority. taking admission. proper relief.
This not only recovers the lost value in such transactions, thereby increasing the possibility of restructuring the CD through resolution planning, but also discourages transactions that do not put pressure on the CD.
“For effective monitoring, modification is needed rp To file Form CIRP 8 on the Board’s electronic platform, informing the details of their opinion and determination with regard to the avoidance transaction,” the release said.
IBBI has prepared Form CIRP 8 and it is required to be filed in respect of every CIRP running or commenced on or after 14th July.
With the amended rules, an insolvency professional conducting the CIRP will have to disclose all former names and registered office address(s) that have been changed in the two years prior to the commencement of the insolvency, as well as the present name of the CD. And also the address of the registered office. All its communications and records.
CIRP refers to Corporate Insolvency Resolution Process.
The amendment takes into account the possibility where a CD may have changed its name or registered office address before the commencement of the insolvency process. In such cases, stakeholders may find it difficult to relate to the new name or registered office address and as a result they fail to participate in the CIRP.
Under the Insolvency Rules, an interim resolution professional or a resolution professional may appoint any professional, including registered valuers, to assist in the discharge of their duties in the conduct of the CIRP.
“The amendment provides that the IRP/RP may appoint a professional other than the registered valuer, if it is of the opinion that the services of such professional are required and such services are not available with the CD.
“Such appointments will be made on arm’s length basis following an objective and transparent process. The challan for the fee will be raised in the name of the professional and paid in his/her bank account,” the release said.
The amendments have come into effect from July 14.
IBBI is a key body in the enforcement of the Insolvency and Bankruptcy Code (IBC)
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