As you may be aware that the Insolvency and Bankruptcy Code, 2016 (the ‘Code’ in short) represents the present insolvency law regime in India. It inter alia lays down provisions regarding reorganization and insolvency resolution as also provisions relating to liquidation vis-a-vis corporate persons, partnership firms and individuals.
Under the Code, the institution of “Insolvency Professionals” has been introduced and established. Insolvency Professionals (‘IPs’ in short) are the professionals who are authorized and vested with very wide powers to carry out different functions under the Code. During the Corporate Insolvency Resolution Process (‘CIRP’ in short), IPs take over management of the Corporate Debtor (CD), form a Committee of Creditors (CoC), carry out CoC meetings et al.
A CS Professional (with 10 years of experience) who wishes to become an Insolvency Professional can do so by clearing the Limited Insolvency Examination conducted by the Insolvency and Bankruptcy Board of India (‘IBBI’). The examination is conducted throughout the year with Centers located PAN India. After clearing the Limited Insolvency Examination, the individual is required to enroll with an Insolvency Professional Agency (IPA), and thereafter undergo a mere 50 hours pre-registration training. Upon completing this pre-registration training, the individual gets entitled to register with the IBBI as an Insolvency Professional. Pertinent to mention that ICSI IIP is one of the only three Insolvency Professional Agencies (IPAs) who are the frontline regulators under the Code and inter alia authorized to carry out enrolment of IPs.
An Insolvency Professional can perform different roles, for instance, he/she can act as an Interim Resolution Professional, Resolution Professional, Authorised Representative of a Financial Creditor, Liquidator, Voluntary Liquidator, Authorised Representative under SEBI Regulations as also as a Consultant/Advisor to various stakeholders involved in relation to the insolvency proceedings.
Pertinent to mention that an IP occupies a unique position and acts as an intermediary between the Debtor/Creditors on the one hand and the Adjudicating Authority (NCLT) on the other and functions under the watchful eyes of the IPA and the IBBI. He/sheoccupies a position of Trust and Confidence and in terms of work, an IP has to carry out different tasks relating to secretarial, legal, finance, management of business of the Debtor, and assessment of assets and liabilities of the Debtor, valuation and sale of assets etc. fall under his/her care.
The NCLT, in one of the matter of “Asset Reconstruction Company (India) Pvt. Ltd. Vs. Shivam Water Treaters Pvt. Ltd.” vide its order dated 16th January, 2019 has held that “…..RP (Resolution Professional) is acting as an officer of the Court and any hindrance in the working of the CIRP will amount to contempt of court.”. Therefore, an IP, while conducting a process, is an officer of the Court and discharges a statutory public function.
In the recent times as well in coming future, for professionals like Company Secretaries, the insolvency profession offers a great opportunity and is possibly the most demanding, involving, challenging and rewarding career options that they can undertake and also to contribute towards the development of the profession, institution and the nation.
Recently, the IBBI, under its IP Regulations, has relaxed certain requirements by permitting those who are in regular employment to appear in Limited Insolvency Examination, enroll with the IPA as also register with the IBBI. Such individuals can start functioning as IPs and take independent assignments after demitting from their regular employment.
As already mentioned, ICSI IIP, as an IPA, carries out enrolment functions for IPs and has its entire procedure (including disclosure requirements) put on the online platform to ensure speedy processing of applications. There are already 850 members (with 900 cases, approximately) who are enrolled with ICSI IIP as IPs. Further, ICSI IIP keeps its members updated on the legislative as well as judicial developments in the field. For the same, the initiates taken by the Institute inter alia include, issuance of Daily Learning Curves, Knowledge Reponere, Monthly IBJ Magazine, conducting regular Interactive Sessions, webinars, et al. In the coming years, as the law expands its horizons covering areas like “Cross-Border insolvency” and “Individual Insolvency”, the number of assignments for the IPs are likely to grow substantially, giving a major boast to the Profession itself.
In the aforementioned background, we encourage all CS members to come forward and be a part of the present Insolvency regime in the country by enrolling them as Insolvency Professionals. We are sure that the rich experience that you have gathered as CS members shall not only be relevant but also extremely important and crucial for developing the profession of an Insolvency Profession itself.
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