IBBI releases guidelines for selection of panel of insolvency professionals

The Insolvency and Bankruptcy Board of India (IBBI), the insolvency regulator, has sought expression of interest from insolvency professionals by 25 June 2023 for getting enrolled into a panel of IPs to be shared with adjudicating authority.

The submission of expression of interest is an unconditional consent by insolvency professionals to act as an Interim Resolution Professional (IRP), liquidator, resolution professional (RP) or Bankruptcy Trustee (BT) of any process relating to a corporate or individual debtor, as the case may be.

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 following:  a) Transport b) Electricity c) Hotels d) Wholesale and Retail Trade e) Construction f) Real Estate g) Manufacturing h) Others (to be mentioned by IP).

The Board will prepare a common Panel of Insolvency professionals for appointment as IRP, Liquidator, RP and BT and share the same with the AA (NCLT and DRT).

The need was felt to prepare the panel of IPs in advance and share with the Adjudicating Authority to avoid administrative delays in appointment of the IP.

The Panel will have validity of six months, and it will have a Zone wise list of IPs based on the registered office (address as registered with the Board) of the IP.

The adjudicating authority may pick 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.

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.

It is also 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.

Eligibility

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 a valid Authorization for Assignment (AFA) which shall not be expiring within six months after effective of date of panel or date of inclusion in the panel, as the case may be.

Also read: Performances of Insolvency Professionals