Ten is too many assignments as resolution professional, five at a time is enough?
The Insolvency and Bankruptcy Board of India, the insolvency regulator, has amended the law to put a cap on the number of assignments an insolvency professional can take at a time as resolution professional.
A circular issued recently read as following: “An insolvency professional may, at any point of time, not have more than ten assignments as resolution professional in corporate insolvency resolution process, of which not more than three shall have admitted claims exceeding one thousand crore rupees each.”
It necessarily means that an insolvency professional can take a maximum of 10 assignments as resolution professional but they can simultaneously take other works like that of liquidator, etc. Currently, there is no such cap on the number of assignments an insolvency professional can take. Industry sources said without any cap some insolvency professionals are taking too many assignments at a time, raising questions on the quality of CIRPs they handle. In one instances, said an industry insider, an insolvency professional was handling 17 CIRPs simultaneously.
But are 10 assignments at a time not too many to handle for an insolvency professional? Most insolvency professionals Insolvencytracker.in talked to said that even 10 assignments as resolution professional are too high, which can be reduced to five subsequently. They even hinted that with a new limit would means more opportunities for insolvency professionals who are new to the profession.
Here are some of their views:
Mano Ranjini MS, Hyderabad-based Insolvency Professional
It is a good move. (The number of assignments) must be reduced further. Depending on the size, the number should be anything between 1-5 maximum. Since the amendment covers RP roles, the insolvency professionals can simultaneously take up work of liquidation, voluntary Liquidation, etc as they are not covered within the prescribed limit.
RK Goyal, Ahmedabad-based Insolvency Professional
There was a need for Some limit (on the numbers of assignments as resolution professional). Today there is no such limit. This number can subsequently be reduced to five.
Chhaya Gupta, Indore-based Insolvency Professional
It is a very welcoming amendment. Every insolvency professional should have a fair and reasonable opportunity. It is practically not possible to handle more than 8-10 insolvency cases. So, I firmly second this amendment brought about by the IBBI.
Swati Singhania, Kolkata-based Insolvency Professional
I think it’s a very good move. This is going to give opportunity to newer insolvency professionals a chance to prove their skill set. Quite likely that they (the new crop of IPs) can do better resolution as well. Whether new IPs would do well or not, only time will tell, but they should get an appropriate opportunity, which the new limit by the IBBI may offer.
Also read: IRP/RPs can appoint any professional for assistance in insolvency proceedings
